In last week’s blog entry we highlighted a new loan program that Fannie Mae recently unveiled called “HomeReady”. This week we will discuss a similar loan program Fannie Mae is now offering which is simply referred to as their “Standard” Mortgage program.
One of the biggest hurdles in achieving homeownership is the task of saving up enough money for a down payment. Similar to the HomeReady program, Fannie Mae’s Standard mortgage program was designed to alleviate this burden by decreasing the required down payment to 3%. Unlike the HomeReady program there are no income limits with the standard program but it does, however, require that at least one borrower is a first-time homebuyer (something not required by the HomeReady program).
Below are several of the more important features of the Standard Mortgage program:
▸ Only a 3% down payment is required (gift funds can be used)
▸ Reserve funds (if required) can also come in the form of a gift
▸ Fixed mortgage rate with a maximum loan term of 30 years
▸ Only one-unit primary residences are eligible (including condos and planned unit developments or PUDs)
▸ Unlike the HomeReady program no pre-purchase homebuyer education course is required
It’s important to point out that in today’s complex lending environment almost any loan program you consider using is going to have little nuances with the potential to cause issues down the road. Therefore, to ensure that you know all your options and are equipped with the knowledge to make an informed decision it’s important that you consult a qualified mortgage professional.
Thanks for reading!