Mortgage Giant Expands 3% Down Loans


Mortgage Giant Expands 3% Down Loans

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Fannie Mae announced this week that it would expand its HomeReady program, which includes 3 percent down payment loans. It is extending the 3 percent down mortgage to eligible refinancers who have loans already owned by Fannie Mae.

Read more: Buyers Stuck on Down Payment Confusion

Fannie Mae’s previous maximum allowable loan-to-value ratio for refinancers was 95 percent. Now, it will be up to 97 percent, under the new guidelines.

Fannie Mae officials announced that it would soon offer LTVs of 97 percent on one-unit limited cash-out refinance transactions.

Officials also announced this week that it’s expanding HomeReady eligibility for temporary buydowns and adjustable-rate mortgages so that they now include three- to four-unit properties as well. Further, the GSE says it will offer lenders some additional incentives to encourage high-LTV borrowers to take part in housing counseling before obtaining a mortgage.

The changes take effect Dec. 10, 2016.

Source: “Fannie Mae Relaxes Standards Slightly to Allow for 3% Down Refinances,” HousingWire (Oct. 24, 2016)

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