Home Possible / Home Possible Advantage
You think buying a home is impossible? Think again!
Freddie Mac Home Possible & Home Possible Advantage
Home Possible mortgages offer home financing options for low and moderate income borrowers looking for low down payments and flexible sources of funds. Home Possible Advantage mortgages offer more flexibility for maximum financing. This offering adopts the responsible and affordable flexibilities of Home Possible, but with additional requirements.
What Makes Them Different
- Home Possible: 1-4 unit SFR, Condo, PUD maximum 95% LTV/CLTV/HCLTV
- Home Possible Advantage: 1- unit SFR, condo, PUD MAX 97% LTV/105% CLTV Secondary financing must be an Affordable Second (and it may not be a HELOC).
- Occupancy: Primary Residence
- Loan Purpose: purchase or rate/term refinance
- Loan Term: 30 year fixed
- Credit Score: min of 620. The borrower’s credit reputation is acceptable as determined by Loan Prospector
- Borrower Requirements: Borrowers do not need to be first time homebuyers.
- Homeowner Education: Homeownership education required on purchase transactions where all borrowers are first time homebuyers. Landlord education is required on Home Possible 2-4 unit purchase transactions.
- Income Limits: Borrower’s annual income may not exceed 100% of the area median income limits (or higher percentage in designated high cost areas). No income limits apply if the property is located in an Underserved Area. Loan Prospector will determine the income eligibility of the Mortgage.
- Mortgage Insurance: >95% TO 97% LTV (Home Possible Advantage Only): 25%
>85% TO 95% LTV: 25%| >80% TO 85% LTV: 12%
Bob and Sally make around what their county median area income limit is. They want to buy their first home, but are nervous that they need a huge down payment. Bob is also worried about expensive mortgage insurance if they did not have 20% to put down. With the Home Possible or Home Ready programs, they can come in with as little as 3% down and take advantage of discounted mortgage insurance rates (depending on income limits, check here http://www.freddiemac.com/homepossible/eligibility.html ).