Mortgage debt has become more appealing for some buyer due to the federal first-time home buyer tax credit, which expires Dec. 1, especially combined with lower home prices and lower interest rates, but the president of Bills.com, Ethan Ewing, has cautioned buyers to be aware of the new changes to mortgage borrowing.

Fannie Mae and Freddie Mac are two very large government-sponsored enterprises that purchase mortgages from the lenders that originate home loans. The U.S. mortgage industry largely follows rules established by Fannie Mae and Freddie Mac. These both back nearly half of all U.S. home loans.

Both the agencies have suffered huge losses in the mortgage meltdown. And in order to save them, the U.S. government bailed them out last September.

Afterward, Fannie Mae and Freddie Mac imposed new restrictions on loans they would purchase after April 1 in order to make mortgage lending more secure. But unfortunately, these new rules also raise the fees on most mortgages for buyers.

The new changes include lower, costlier appraisals, longer processing times, new risk-based pricing, and higher mortgage processing fees.

These rules are a reaction to a mortgage-lending industry that had spiraled out of control, which is a good news for the economy. The new regulations can be a headache for individual buyers, but those who are well prepared to purchase, will not be prevented from these rules to buy a piece of the American dream.

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