Michigan Senate Bill SR0056

Michigan 2023-2024 Regular Session

• Introduced: 6/6/23
• Refer: 6/6/23

Caption

A resolution to strongly condemn the May 2023 changes to the upfront fees on home mortgages charged by Fannie Mae and Freddie Mac under the direction of the Federal Housing Finance Agency.

Impact

The resolution highlights the implications of the FHFA's policy shift on the state's housing market, arguing that it could lead to a decrease in incentives for responsible borrowing and budgeting. With a competitive housing market already burdened by supply shortages, increasing upfront fees for responsible buyers may exacerbate the existing economic challenges faced by middle-class families in Michigan. The emphasis is on how these changes threaten the stability of the housing market and ultimately hinder access to homeownership.

Summary

Senate Resolution 0056 aims to strongly condemn recent changes made by the Federal Housing Finance Agency (FHFA) regarding upfront mortgage fees. These changes, effective May 1, 2023, have been criticized for penalizing financially responsible homebuyers by increasing fees for those with better credit scores while simultaneously reducing fees for riskier borrowers. The resolution emphasizes that these alterations can destabilize the housing market and adversely impact Michiganders' ability to purchase homes.

Contention

There are significant concerns surrounding the fairness and consequences of the fee redistribution. Critics argue that rewarding riskier borrowers at the expense of those who have historically been responsible undermines the foundational goals of Fannie Mae and Freddie Mac to provide reliable access to mortgages while maintaining lower interest rates. This resolution argues for a return to policies that incentivize good financial practices and enhance the security of homeownership opportunities across the state.