According to Fannie Mae guidelines, what is the maximum percentage of loan amount that can be charged on a credit card during transaction fees?

The correct answer is that Fannie Mae guidelines specify that the maximum percentage of the loan amount that can be charged on a credit card during transaction fees is 1%. This guideline is part of Fannie Mae's effort to ensure that transaction fees remain reasonable and do not excessive burden borrowers. By limiting these fees, Fannie Mae aims to protect consumers from potentially high costs associated with using credit cards for transaction-related expenses during a loan process, thereby helping to maintain affordable access to mortgage financing.

Understanding this limit is essential for mortgage professionals to ensure compliance with Fannie Mae’s practices, which ultimately impacts the cost of borrowing for consumers. The percentage is kept low to discourage excessive charges that could lead to financial strain for borrowers, promoting responsible lending and borrowing practices.