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New FHFA chief reverses course on Fannie, Freddie loan-fee hikes

(Corrects day of the week in lead)

WASHINGTON, Jan 8 (Reuters) - The U.S. regulator for Fannie Mae and Freddie Mac on Wednesday instructed the two taxpayer-owned mortgage finance companies to delay the increase in fees on government-backed loans that the agency announced last month.

Mel Watt, the new director of the Federal Housing Finance Agency, said he plans to study the "implications for mortgage credit availability" before moving ahead with the fee increases. The FHFA would provide not less than 120 days' notice after completing the study before making final changes.

Fannie Mae and Freddie Mac were scheduled to increase their guarantee fees in 2014. The fees often trickle down to borrowers, and result in higher mortgage rates.

(Reporting by Margaret Chadbourn; Editing by James Dalgleish)