The long awaited “MyCommunity Mortgage” replacement is finally here with with Fannie Mae HomeReady™ Mortgage. Is it exactly the same? No. Is it similar? Yes. Does it have more capabilities? You betcha! Below are the facts. If you have specific questions, feel free to contact me at anytime!
What is the Fannie Mae HomeReady™ Mortgage?
- Minimum 3% down payment mortgage (97% loan to value)
- Gifts, grants, Community Seconds®, and cash-on-hand permitted as a source of funds for down payment and closing costs
- Minimum credit score is 620 (get FREE scores here)
- Debt to income (DTI) ratio up to 50% (Calculate your DTI here)
- No upfront mortgage insurance required
- Will consider income from: a non-borrower household member as a compensating factor to allow for a debt-to-income ratio >45% to 50%
- Allows non-occupant borrowers, such as a parent (and extended household income)
- Permits rental income from an accessory dwelling unit (such as a basement apartment)
- Allows boarder income (roommate)
- Borrower is NOT REQUIRED to be a first-time buyer
- Lower Mortgage Insurance coverage requirement than conventional mortgage
- Allows for nontraditional credit (phone bills, power bills, etc)
Are there maximum income requirements?
- Yes. There are some income ceilings. To see if you qualify, first, find the address of the home you are interested in, then enter it here.
- Next, download this Microsoft Excel file from Fannie Mae. You’ll want to match up the Tract number from the first page. This will show the maximum income allowed.
- For much of the Raleigh city limits, the maximum income is $63,040. For much outside of the city limits, there are no income limits!
- If you need help with this, let me know and I can look it up for you!
Is a homeownership class required?
- Yes. Borrowers will invest 4−6 hours (average) of their time and a modest fee of $75 (paid to Framework) to learn the fundamentals of buying and owning a home, take an online test, and receive a certificate of completion. It can be fulfilled online with Framework. If you have taken a home ownership class in the past 6 months, it will transfer!
More information, directly from Fannie Mae, can be found here.
For a free rate quote, or more information on anything mentioned here or elsewhere, feel free to contact me with any questions/queries.