Lenders who use the U.S. Department of Agriculture Rural Housing Service's Single Family Housing Guarantee Program will pay less beginning in October, the department said last week.
The USDA will lower the upfront and annual fees charged to lenders starting Oct. 1. The department cited low delinquency and foreclosure rates as the reason why it chose to lower fees.
The upfront fee will be lowered from 2.75% of the loan-at-close amount to 1%. And the annual fee will drop to 0.35% of the unpaid principle loan balance from 0.45%.
"When our borrowers succeed, the program succeeds," USDA Rural Housing Service Administrator Tony Hernandez said in a news release. "Excellent overall performance in our Single Family Housing Guaranteed Loan Program means we can charge less for the life-changing opportunity to own a home."
