Fannie Mae Set to Raise Fees--Borrowers See it in Interest Rate

As Fannie Mae prepares for what is certain to be a brutal quarterly earnings report to analysts and investors on August 8, stockholders can rest assured higher fees are on the way.

Fannie Mae has announced to lenders a October 1 increase in delivery fees from 0.25 to 0.50 percent point on mortgages it helps finance. Introduced earlier this year, the "adverse market delivery charge" is expected to pass through to the mortgage borrower in the form of high interest rates.

Fannie Mae, which now finances more than 70% of all US mortgages, also announced that they will be increasing guarantee fees that it charges on financed loans based on borrower down payments and credit scores.

These adjustments are said to be moves to better align loan pricing with credit risk. The certainty is that mortgages for consumers are rapidly becoming less affordable and potentially driving more downward pressure on home prices.