Federal Housing Finance Agency (FHFA) Director Mark Calabria responded to letters from CUNA and all 35 state Leagues expressing concerns over the proposed GSE refinance fee. CUNA wrote to the agency August 14 and followed up with the letter from CUNA and the Leagues Aug. 25. Soon after, the FHFA announced the fee implementation would be delayed by three months to Dec. 1.

FHFA has also exempted from the fee refinance loans with loan balances below $125,000, nearly half of which are comprised of lower income borrowers at or below 80% of area median income.

Calabria wrote in his letter that the fee is necessary to cover projected losses of at least $6 billion at the GSEs due to the pandemic.

According to Calabria, these losses include:

• $4 billion in loan losses due to projected forbearance defaults;
• $1 billion in foreclosure moratorium losses; and
• $1 billion in servicer compensation and other forbearance expenses.

“These projected losses, which may be higher depending on the path of the economic recovery, arise from actions the Enterprises have taken during the pandemic to protect renters and borrowers,” Calabria wrote. “Such actions are consistent with other federal relief efforts and include offering forbearance on multi- and single-family mortgages, buying loans in forbearance, modifying mortgage terms to reduce monthly payments and simplify repayment options, providing protections for tenants in multifamily properties associated with forborne loans, and providing loan processing flexibility.”