Joe Biden proposes rule to punish homebuyers with good credit, down payments to support buyers with bad credit

Huh?

So, President Joe Biden is poised to implement a crazy new federal rule that punishes responsible borrowers and rewards irresponsible or risky ones.

As part of the Federal Housing Finance Agency’s (FHFA) affordable housing plan, the administration’s new rule increases payments for homebuyers with good credit to subsidize borrowers with risky mortgages.

It is estimated that homebuyers with credit scores above 680 and who have down payments between 15 and 20 percent will pay higher fees.

Moreover, the federally-backed mortgage entities Fannie Mae and Freddie Mac are enacting loan-level price adjustments.

“The changes do not make sense. Penalizing borrowers with larger down payments and credit scores will not go over well,” Ian Wright, a senior loan officer at Bay Equity Home Loans in the San Francisco Bay Area, told The Washington Times in an email message. “It overcomplicates things for consumers during a process that can already feel overwhelming with the amount of paperwork, jargon, etc. Confusing the borrower is never a good thing.”

This will go into effect on May 1.