Loan Level Price Adjustments 

Home loan rates are based on multiple factors. These are typically: the property type, the purpose for the loan, whether it is a refinance or a purchase, the occupancy type, the lowest mid-credit score of the Borrower(s) and the loan-to-value percentage. 

For each of the factors above, there are adjustments to the pricing of the loan’s interest rate. For a Borrower that is putting less down, has a lower credit score, or is buying a condo, for example, there may be adjustments that could raise their interest rate. If a Borrower has a high credit score and is buying a Single-Family Residence, they could potentially get a better rate based on those factors. 

There is a matrix for pricing adjustments for each type of loan available. Those types include, but are not limited to FHA, VA, Conventional and USDA.  

Recently the FHFA, Federal Housing Finance Agency, the agency that oversees Fannie Mae, Freddie Mac and the Federal Home Loan Bank System, made the announcement that the loan level price adjustments (LLPAs) associated with Conventional loans will change starting on May 1, 2023. This change is being made to afford more minority household formations the ability to realize the American dream of homeownership. 

To compare the existing LLPAs to the new, please see the charts below. For a full list of adjustments, new and old, visit https://singlefamily.fanniemae.com.  

Please note that changes to LLPAs have happened before and will happen again in the future. It is likely that many lenders have already started to factor these changes into their pricing in anticipation of the charges they will be responsible for paying in fulfillment of the loan.  

Although there can be benefits to going with a Conventional loan, FHA, VA and USDA type loans may be great options for your Buyers too. Be sure to work with a Mortgage Loan Originator that will give them detailed comparisons between the loan types so the loan they choose is ultimately the best option for long-term homeownership. 

Loan level price adjustments as of 5/1/2023: 

Loan level price adjustments pre – 5/1/2023 change: 

Loan Level Price Adjustments 

Gigi Kisil
Loan Originator
Bella Vida Mortgage 

8th Annual Journal Industry Awards
Mortgage Loan Originator of the Year