Biden to Punish Good-Credit Homebuyers to Subsidize High-Risk Mortgages

April 20, 2023

A new rule from the Biden administration will force homebuyers with good credit scores to pay higher mortgage rates in order to subsidize loans to those with riskier borrowing profiles, the Washington Times reports.

The fee, which will apply to those buying or refinancing houses after May 1, will affect homebuyers with credit scores of 680 or higher, will amount to roughly $40 per month on a home loan of $400,000, or nearly $500 per year. Homebuyers who make down payments of 15% – 20% will be hit with the largest fees.

According to those in the industry, the changes will frustrate homebuyers with high credit scores, as well as those looking to refinance, as they’re being punished for having strong financial positions.