• Sen. Rick Scott, along with Senators Mike Braun and Roger Marshall, introduced the Middle Class Borrower Protection Act in Congress to reverse a Biden administration provision.
  • The provision by the Federal Housing Finance Agency (FHFA) allows borrowers with lower credit scores and limited funds for down payments to access more favorable mortgage rates, but high-credit-score borrowers will incur a surcharge fee to offset risk.
  • Florida Chief Financial Officer Jimmy Patronis joined a consortium of 33 financial officers from 27 states to call for the reversal of the federal mortgage equity policy.
  • Patronis and other state leaders contend that the policy effectively functions as a quasi-tax on middle-class mortgage holders.

Sen. Rick Scott is supplementing efforts undertaken by other Florida leaders to reverse a Biden administration provision that detractors allege would increase mortgage rates for many middle class Americans.

Scott, alongside Senators Mike Braun and Roger Marshall, introduced the Middle Class Borrower Protection Act in Congress last week, which would restore the Loan-Level Price Adjustment (LLPA) to its former standards.

The Federal Housing Finance Agency (FHFA) recently adopted new policy regulations in May that enable borrowers with lower credit scores and limited funds for down payments to access more favorable mortgage rates than they would have been eligible for under previous policy guidelines.

While the expanded eligibility criteria is intended to benefit financially disadvantaged borrowers, those with high credit scores will incur a surcharge fee on loan-level price adjustments to offset the accrued risk.

“Folks that have worked hard to save up and build good credit shouldn’t be punished for doing so,” said Scott. “This is ‘Bidenomics’ in action. People who are responsible, like those who have paid off their student loans or Americans who’ve worked hard to build good credit, should be seen as role models, not piggy banks for the left. It’s not fairness, it’s socialism, and I’m proud to join my colleagues to reverse it.”

Financial experts cited by Fox News state that under the policy, borrowers with a credit score of 680 would pay approximately $40 more per month on a $400,000 mortgage. In total, the new fees increase costs to borrowers by 0.04 percent overall, according to FHFA.

Moreover, under the amended structure, a buyer with a 740 FICO credit score and a 15- to 20-percent down payment would face a 1 percent surcharge, according to a report published by the New York Post.

Following the changes, Florida Chief Financial Officer Jimmy Patronis joined a consortium of 33 financial officers spanning 27 states in a call to reverse the federal mortgage equity policy, contending that it serves as a quasi-tax on middle-class mortgage holders.

“Their plan to redistribute mortgage fees from those with good credit to those with poor credit … sounds like a way to hurl our economy into another housing crisis,” said Patronis. “I was in the Florida Legislature when the last sub-prime mortgage-induced recession hit our state and I don’t want Floridians to live through that again. I hope the Biden Administration will come to their senses and end this rule immediately before it causes irreparable financial damage to Floridians who are working every day to live the American Dream.”

FHFA Director Sandra L. Thompson, however, asserts that the updated borrowing framework remains in line with prior increases in mortgage eligibility.

“​Higher-credit-score borrowers are not being charged more so that lower-credit-score borrowers can pay less,” she said. “The updated fees, as was true of the prior fees, generally increase as credit scores decrease for any given level of down payment.”


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