The Federal Housing Finance Agency (FHFA) recently announced plans to delay the implementation of its adverse market refinance fee to Dec. 1. Under the plans, first announced Aug. 12, refinance mortgage loans sold to Fannie Mae and Freddie Mac would impose a 0.5% fee — with loan balances under $125,000 being exempt in the latest announcement.
The fee was initially opposed by the Mortgage Bankers Association, but the organization welcomed the FHFA’s decision to postpone the rollout and exempt certain refinances. Part of the group’s concern stems from rising refinance activity and the impact such a penalty could have on homeowners’ attempts to lock in record-low interest rates.
For example, the adverse market fee on a loan for the median home price of $291,300 would cost homeowners an extra $1,456 when they refinance. In an environment that has seen refinance lending already drive Q2 2020 originations to the highest quarterly volume on record and signs of further growth in Q3, this adverse market fee holds the potential to hit the pockets of millions of Americans.
With the fee delayed, now is the time for lenders to implement a dynamic loan origination system (LOS) that can improve cycle times and enhance the customer experience before they are impacted by this 0.5% refinance fee.
Leveraging Black Knight Empower®
The Black Knight Empower® loan origination system (LOS) delivers these capabilities to lenders in a scalable and integrated solution offering an intelligent workflow, exception-based processing, digital consumer interfaces, an integrated pricing engine, client-configurable, loan-level compliance testing, actionable analytics and more. By leveraging Empower, lenders have the ability to originate first mortgages and home equity lines and loans on a single system for the added benefit of lowering costs and reducing risk.
The LOS provides industry-leading functionality at all critical steps of the origination process including point-of-sale, processing, underwriting, closing, funding and post-closing. Empower also includes an expansive number of integrated tools and services to further enhance the origination process.
Implement Empower Now
With millions of homeowners eligible for mortgage payment savings through refinance, there has never been a more important time to leverage a solution that can streamline the origination process.
Empower’s unique and advanced capabilities are available now, and with Black Knight’s extensive implementation experience, lenders can be converted in only a few months onto this innovative LOS and staff trained quickly — no matter the size of the operation. In addition to Black Knight’s training offerings, you’ll also benefit from our team of highly skilled and professionals assigned to each account. Your support team will be available 24/7/365 and will remain closely involved to make sure you are fully optimizing Empower.
To learn more about how Empower can help you improve cycle times, reduce costs and enhance the customer experience before the FHFA’s refinance fee goes into effect, contact a Black Knight representative today.