Credit Union Charging LLPA fee for a non Fannie/Freddie Mortgage?

[Jon Binder]

Hello,

Background: I am in the process of purchasing a new principle residence. I am using a local credit union for financing and putting 10% down. Originally, the credit union was planning on financing under Freddie/Fannie guidelines. However, that deal fell apart, so the credit union decided to carry the mortgage in-house. Thus, no PMI due to in house lending.

My concern: They are charging me 1% at closing for LLPA (Loan-Level Price Adjustment). I have been a member of this credit union for 10+ years and have my current mortgage with them as well.  My credit score is 700+. 

Question: Can anyone confirm that this is something I should contest?  They are charging me a $750 loan origination fee already. I did a bit of Googling and read that LLPA only applies to Freddie/Fannie loans.  Will my BP friends give me some advice and/or direction on this?

Jon