New 3% downpayment programs will become available in December 2014, thanks to Fannie Mae and Freddie Mac.
According to a Bloomberg news report, the companies will start offering this low downpayment program beginning December 13th.
Currently, Fannie Mae and Freddie Mac make up more than half of new home loans. They have allowed down payments as low as 5% up until this point, though Fannie Mae accepted a limited number of 3% downpayment loans as early as November 2013, with very strict guidelines, according to an LA Times article.
To access the 3% downpayment programs, there will be very strong underwriting standards.
The LA Times article has very specific information on the two programs. There are strict qualifications, as well as for first-time homebuyers, a requirement to participate in a home ownership education and counseling program. Freddie Mac’s program will be called, “Home Possible Advantage.”
Fannie Mae’s program will be open to anyone who has not owned a primary residence in three years. It will not require education or a counseling program.
FHA already has a 3.5% downpayment program, with less-strict requirements.
I will be interested to learn more about both of these programs as they are put into use as of December 13, 2014.
If you have questions about a Baltimore mortgage, please let me know, and I will direct you to a knowledgeable mortgage professional!