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Released: August 21, 2010

Ban on private transfer fees could cost homeowners

Source: Kenneth R. Harney, Washington Post (Free Registration)

A federal agency is moving to prohibit controversial “private transfer fees” on all mortgages funded by Fannie Mae and Freddie Mac. But its proposed ban might extend to transfer fees routinely collected by community associations across the country - potentially forcing some of them to raise assessments on thousands of unsuspecting homeowners.

The Federal Housing Finance Agency (FHFA), which oversees the two mortgage giants in conservatorship, issued proposed “guidance” Aug. 12 that would prohibit Fannie and Freddie plus the federal home loan banks from investing in mortgages carrying private transfer-fee covenants.

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