HomeReady Loan and Home Possible Loan in Boynton Beach, FL – What are they?
Many homebuyers in Boynton Beach, FL, have a hard time juggling their everyday expenses while saving money for closing costs or down payment. Car payments, credit card bills, student loan payments, rent, utilities, and unexpected medical bills can quickly drain your bank account. These expenses can make saving enough money for a down payment very hard, especially if your income is low. Considering all this, it is no surprise that saving enough money is one of the major hurdles to buying a home. Fortunately, low-income buyers in Boynton Beach, FL, no longer have to save a lot of money for a down payment. The reason is that Fannie Mae and Freddie Mac now offer loans with low down payment requirements.
HomeReady Loan by Fannie Mae and Home Possible Loan from Freddie Mac come with a 3 percent down payment requirement. Moreover, the minimum credit score required for these loans is 620. This relaxed requirement makes them a compelling option for borrowers with low-to-moderate incomes. Other details and requirements of HomeReady Loan and Home Possible Loan in Boynton Beach, FL, are discussed below:
Boynton Beach, FL HomeReady Loan
HomeReady Loan, offered by Fannie Mae, comes with a low down payment requirement of 3 percent. Both first-time and repeat homebuyers may qualify for it. If a borrower puts less than 20 percent down payment, they must pay for mortgage insurance. However, unlike FHA loans, mortgage insurance is only added as monthly premiums and not included as an upfront cost. Moreover, it can be canceled under certain conditions.
Another great thing about this loan is that Fannie Mae accepts cash-on-hand, Community Seconds, gifts, or grants as an additional source of funding for closing costs and down payment.
It is worth noting that since HomeReady Loan aims to serve low-to-moderate income borrowers, it comes with certain income limits to ensure that only low and moderate-income borrowers may qualify it. The borrower may qualify for a HomeReady Loan if their income is less than 80 percent of the area median income for the location of the property. This limit now also applies to properties in low-income census tracts. Previously these properties were excluded from income limits.
Boynton Beach, FL Home Possible Loan
Boynton Beach, FL Home Possible Loan was created to offer a low down payment loan option for borrowers with low-to-moderate incomes. It is a conventional loan that requires only a 3-percent down payment. Since Freddie Mac backs this loan, the borrowers can get reduced mortgage insurance premiums, more flexible terms, and refinancing options.
Like the HomeReady Loan, the Home Possible Mortgage also includes mortgage insurance premiums if the borrower is putting less than 20 percent down payment. Borrowers can use this loan for eligible manufactured homes, primary residences, and 2-to-4-unit owner-occupied properties. The Home Possible Loan also comes with income limits. A borrower can qualify for this loan if their income doesn’t exceed 80 percent of the area median income for the location of the property.
If you want to apply for a HomeReady or Home Possible Loan or have any questions about these two programs, talk to the experts at Fourpath Mortgage. Call 954-507-7553 to get in touch with us.