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Fannie Mae vs. Freddie Mac 3% Down

April 10th, 2015 by Sean Stephens

Thanks to recent changes, both Fannie Mae and Freddie Mac mortgage lending programs now offer a 3% down conventional loan option. In today’s video, we will discuss key differences in the Fannie Mae vs. Freddie Mac 3% Down payment program options.

If you are thinking about utilizing the Fannie Mae or Freddie Mac 3% down payment programs, and you live in Florida, Texas, Tennessee, or Alabama, this short video will cover the details on how you may be able to save money on your next conventional loan.

Recent program changes that resulted in down payment reductions by both Fannie Mae and Freddie Mac, have made conventional loan programs more affordable.

Fannie Mae:
As a quick review from a previous post, effective December, 2014 Fannie Mae now allows 3% for a down payment.

One of the more notable stipulations of this program is that at least one borrower on the application must be considered a first-time homebuyer.

Fannie Mae defines First-Time Home Buyer as someone that:

  1. Will reside in the property as a principle residence, and
  2. Has had no ownership interest (solely or jointly) in a residential property during the three-year period preceding the date of the purchase.
  3. There are also additional criteria that may apply. See here for more information Fannie Mae First Time Home Buyer definition.

Improved interest rates and mortgage insurance (PMI) are available under the MyCommunityMortgage® feature. While this does fall under the Fannie Mae umprella, there are additional requirement involved. If you have questions regarding this, please call or email.

Freddie Mac Fannie Mae 3 Down Florida

Freddie Mac:

As of 3/23/15, Freddie Mac allows for 3% down payment through their Home Possible Advantage® mortgages.

  • While there is no first-time homebuyer requirement, applicants may not have any ownership interest in other residential properties at the time of closing.
  • If applicants are considered a first-time homebuyer, homebuyer education and counseling will be required which includes the Freddie Mac’s Credit Smart online training.
  • Gift funds are allowed – this is a new Freddie Mac improvement, specific to Home Possible Advantage mortgages.
  • Income Limits will apply – read more about these here.

As always, remember that minimum credit conditions will apply and sufficient equity will be required on all programs.

While we usually cover USDA home loan topics, I did want to keep you in the know about additional financing options, in case a USDA loan may not apply.

Whether it be USDA, FHA, VA, or Conventional loan programs we appreciate you trusting us for all of your financing needs.

We thank you for reading and encourage you to leave a comment below or send us a question via email.

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