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Fannie Mae Down Payment Assistance Mortgage Program
Does Fannie Mae have a down payment assistance mortgage loan program for first-time homebuyers?
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2 Replies
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Is there a house hold income cap?
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Certainly, Fannie Mae has a number of programs which are designed to help first-time home buyers with down payment:
Primary Programs:
HomeReady Mortgage:
Down Payment Requirement: Doesn’t exceed 3%.
Eligibility: It is targeted at low to middle income borrowers, first time purchasers, and areas defined as census tracts. There isn’t a requirement to be a first-time purchaser, but income eligibility is determined on the average annual income within the area in which the buyer intends to purchase the dwelling.
Features: Policy Providing Employment Gaps, Discretionary Job Loss and Retirement Disbursements. Flexible funding sources can include gifts, grants and second mortgages. If all occupying borrowers are first-time homebuyers, then homeownership education is a prerequisite. It also includes PPP (Personal Preview Profile) waivers for allowable loans, in which borrowers can reduce their repayments while still making profit on the loans.
HFA Preferred:
Collaboration: The availability of this program goes through the state Housing finance Agencies (FHA’s) that can in addition provide a down payment loan or gift along with the mortgage loan.
Down Payment: It can be as low as 3% with PMI.
Benefits: Not only first time homebuyers but HFAs providing down payment or closing costs can also use second mortgages or additional funding including grants.
HomePath Ready Buyer Program: This is specifically designed for persons getting their first home that has been put up for foreclosure, through this program they are able to gain some percent of buying the home, specifically, three percent closings cost that is regarded, along a home owned bu fannie Mae where the outstanding payments have been made available to the buyer.
Education Requirement: You’re obligated to complete the HomePath Ready Buyer™ educational course, and the course fee is reimbursed by Fannie Mae at the time of closing.
Additional Considerations:
Community Seconds: These are secondary liens which may assist in their down payment and closing cost, and may also involve Fannie Mae’s other programs like HomeReady. They can come from many sources including government agencies, nonprofits, or employers.
Grants and Loans: With the products of Fannie Mae, they permit down payment assistance in the form of grants or loans from third parties.
Down Payment Resource Tool: In collaboration with DownPaymentResource.com, Fannie Mae provides a search tool useful for finding down payment assistance programs to potential buyers.
Key Points:
These programs have been established with a view towards facilitating the attainment of homeownership by individuals especially low to moderate income because it has been appreciated that the lack of sufficient saving for down payment has been a huge barrier for such individuals.
First time homebuyers may be required to attend homeownership education courses as part of the qualification requirements to be so as to guarantee an improvement in their perceptions of home buying and ownership.
Programs availability at times and levels of assistance may differ from one HFA or linking programs to this setting to another at state or local levels.
Because of this, even though Fannie Mae does not directly make cash payments for downpayment assistance, it has designed its mortgage products such that they integrate with certain financial assistances which are quite useful especially to first time homebuyers.