Making homeownership affordable to a wide range of borrowers is the goal of Freddie Mac’s Home Possible® mortgage program. By offering significant flexibility and benefits to borrowers, Home Possible® appeals to first-time homebuyers, move-up borrowers, low- to moderate-income borrowers, retirees, families in underserved areas, and new immigrants.
Benefits of Home Possible®Freddie Mac Home Possible® appeals and includes so many borrowers because it allows the purchase of 1-4 unit primary residences, condos, PUDs, and manufactured homes with fixed-rate or adjustable rate financing or no cash-out refinances. Borrowers also benefit from:
- Low down payment. This loan program only requires a 5 percent down payment, which can be fully gifted (no borrower contribution required) for 1-unit properties.
- Reduced mortgage insurance coverage levels
- No reserves required for 1-unit properties.
- Down payment assistance programs allowed in conjunction to reduce closing costs.
Who is Eligible?
As previously stated, Home Possible® is meant to open doors for a wide range of homebuyers, but borrowers are still subject to income, credit, and property requirements. Eligibility for financing includes:
- Homebuyer education. First-time homebuyers must complete this step before the effective date of the permanent financing.
- Down payment for multiple-unit properties. If a borrower is purchasing a 2-4 unit property, they are required to contribute 3 percent of their own funds toward the required 5 percent down payment.
- Reserves for multiple-unit properties. Borrowers are also required to have two months reserves, which can not be gifted, when purchasing a 2-4 unit property.
- Borrower income can not be more than 100% of the HUD area income
For additional information about Freddie Mac Home Possible®, contact one of our mortgage bankers. Wanting more information on loan products and homebuying in general? Our Mortgage 101 Handbook is a great resource for all of your homebuying questions.