HomeReady Mortgage (Conventional Loan)
HomeReady is an affordable low down payment mortgage product designed for creditworthy low- to moderate-income borrowers, with expanded eligibility for financing homes in low-income communities. Low down payment with up to 97% LTV financing for home purchases. Competitive pricing meets or beats our standard loan pricing. Flexible sources of funds with no minimum contribution requirement from borrower’s own funds (1-unit properties). Rental and boarder income may be considered for qualifying. CLTV up to 105% for loans with an eligible Community Seconds® transaction. Cancellable private mortgage insurance per Servicing Guide policy. Reduced MI coverage requirements for LTVs above 90% (up to 97%). Homeownership education and housing counseling options empower borrowers to become successful homeowners. Must meet income eligibility which differs depending on where property is located. Check here: https://homeready-eligibility.fanniemae.com/homeready/
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 ).