With rates at record lows, you may be considering about refinancing your mortgage. However, be aware that it could be a more expensive transaction.

Effective on December 1st, a 0.5% adverse market fee will be imposed on lenders by mortgage backers Fannie Mae and Freddie Mac. Many experts are suggesting that homeowners are going to absorb at least some of the cost when they refinance. According to CNBC, certain refis are exempt, including those for loan balances below $125,000.

“If you assume it takes two months to close on the refinance, anything applied for after early October could push to December,” said Joel Kan, associate vice president of economic and industry forecasting for the Mortgage Bankers Association.

To put that into perspective, consider a $280,000 mortgage with a 0.5% adverse market fee. This would mean your lender is charged an extra $1,400 when your loan is sold to Fannie or Freddie. The expectation is that the extra cost will be passed on to the borrower in the form of higher interest rates.

The adjustment could add an extra 0.125 to 0.25 percentage points, the association estimates. Right now, it’s possible to get a 30-year conventional mortgage or refinance at a rate below 3%. A year ago, they were pushing 4%.

The adverse market fee was initially scheduled to start Sept. 1, but was delayed in late August to give the industry time to prepare.

The Federal Housing Finance Agency, which oversees Fannie and Freddie, said the fee is intended to offset a projected $6 billion in losses — largely related to loans in forbearance and, separately, the anticipated rate of default among mortgages backed by Fannie and Freddie as unemployment remains high and economic uncertainty persists. via CNBC