H.R. 3564, Middle Class Borrower Protection Act of 2023

Received June 23,2023.

Established in 1974, The Congressional Budget Office is a federal agency within the legislative branch of the United States government.  It is charged with providing  members of Congress  non partisan, objective  analysis of budgeting and economic issues to support the congressional budget process. Each year, CBO economists and budget analysts produce dozens of reports and hundreds of cost estimates for proposed legislation.

For the past several months I have been receiving  directly from CBO links to  which I now plan to begin posting  selectively on this blog in the interest of information sharing.  If there appears to be sufficient interest among readers of this blog over a period of time, I plan to continue posting selections I receive from CBO.


H.R. 3564 would repeal the structure of upfront fees related to mortgages that was instituted by the government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, on May 1, 2023, and reinstate the fee structure that was in place prior to that date. Upfront fees are charged to a borrower when the mortgage is originated and are based on the loan amount. The previous fee structure would be in place until the Government Accountability Office (GAO) completes an assessment of the current upfront fees, at which point, the Federal Housing Finance Agency (FHFA) could propose a new fee structure. As part of that process, the bill would require:

  • The FHFA to observe federal procedures for issuing new rules, and
  • That any future modifications to upfront fees be based on the risk posed by the mortgage to the GSEs.

CBO expects that it would take GAO a little more than a year to complete its assessment and another year for the FHFA to implement any changes. Thus, under H.R. 3564 any updated fee structure would take effect around the beginning of 2026. Using information from the FHFA and CBO’s projections of GSE mortgage volume, CBO estimates that enacting the bill would increase direct spending by $900 million in 2024 and 2025. That increase in spending would occur because the amount of fees paid under the fee structure that was in place before May 1, 2023, would be less than under the existing structure. Beginning in 2026, CBO expects the FHFA’s updated fee structure would be broadly consistent with our current baseline projections. The actual fees could be higher or lower than those projections.

In addition, based on the cost of similar studies, CBO estimates that the cost of GAO’s study would be less than $500,000. Any spending would be subject to the availability of appropriated funds.

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