FNMA Home Ready
Home Ready Program (FNMA)
HomeReady is a program within the FNMA conventional loan product. It is designed to help those with low to moderate income, in designated areas, to utilizing income flexibilities, such as room rent income to qualify whereas the standard product will not. The guidelines are a little more flexible when it comes to income, credit and non-occupying borrowers. The program offers two major benefits. One is the flexible guidelines and two is the lower payments.
What are the benefits?
- Lower interest rate
- Lower private mortgage Insurance
- Allows non-occupying borrowers
- Allows flexible income such as room rents
- Allows higher debt to income ratios of 50% (with compensating factors)
- Considers alternative credit or non-traditional credit such utilities, etc.
- Use with 97% first time homebuyer conventional product
How does the program work?
FNMA has a designated areas mapped out for every census track throughout the United States. Each property has an income limitation that cannot be exceeded. The address of the subject property can be entered into the system to find out what your areas maximum income limit is. The CMF loan officer can make the preliminary check for you. Even if you are not low to moderate income, there is still a potential advantage of receiving lower payments if the subject property is located in a no-income-limit area.
HomeReady is a simple program you either qualify or you don’t. This does not mean you are not qualified for the standard Conventional 97%. Just look at this program as bonus if qualified. Just ask your CMF loan officer today if you qualify for a HomeReady program. This program can be used for a purchase and a refinance.