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HomeReady® is Fannie Mae's affordable, low down payment mortgage product designed for creditworthy low- to moderate- income borrowers, with expanded eligibility for financing homes in low-income communities. This product is designed for loan amounts under $424,100 and offers 10, 15, 20, and 30-year terms. This loan requires that at least one borrower meet homebuyer education requirements.
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HomeReady Benefits:
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Low down payment; as little as 3% down for home purchases
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Flexible sources of funds with no minimum contribution from borrower’s own funds
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Non-occupant borrowers permitted
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Reduced MI coverage requirement for loan-to-value ratios above 90% (up to 97%)
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Pricing is better than or equal to Fannie Mae’s standard loan pricing (risk-based pricing waivers for LTV ratios > 80% with a credit score ≥ 680)
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Useful for single family, manufactured, multifamily 2-4 units, condos or PUD
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Loans can be used for purchases or limited cash-out refinances
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Mortgage Payment System (MPS) and online payments accepted
Home Ready FAQ’s
Q. How do I know if my borrower is eligible for Home Ready?
A. Your DU/DO findings will identify, on a preliminary basis, if the borrower is Home Ready eligible based on income information shown on the application/entered into DU/DO. Before locking Home Ready, it is strongly recommended that you have underwriting review income documentation for each borrower to ensure compliance with Home Ready guidelines. https://homeready-eligibility.fanniemae.com/homeready/
Q. The Loan Officer Portal shows options for: Home Ready Plan 9030 and Home Ready Plan 9130 in addition to Plan 9030 – Agency Mandatory and Plan 9130 – Agency Best Efforts. How do I determine which plan to lock into? Will the Portal allow me to lock Home Ready even if my borrower is not eligible for the program?
A. If you had received the notification in your DO findings OR see a notification/condition on your preliminary DU findings in the Loan Officer Portal AND have had income reviewed by an underwriter to determine that the loan is truly Home Ready eligible, you may lock into either Home Ready plan. The Loan Officer Portal will allow you to lock Home Ready even if the loan/borrower is not eligible for this product. Please be aware that the only sure way to know whether the loan is Home Ready eligible is to see the Home Ready eligibility message in your DO findings or separate condition in your preliminary DU findings AND to have underwriting review income documentation.
Q. I see a message in my preliminary DU findings in the Loan Officer Portal indicating that my borrower might be eligible for Home Ready (or I see the Home Ready eligibility message in my DO findings); I’ve submitted income documentation and underwriting has confirmed that Home Ready is a valid offering. How do I go about changing this loan to the Home Ready product?
A. Please submit a change request as you would do to request any other change.
Home Buyer Education Requirements Info
The Framework® course makes it simple to meet the requirement. At least one borrower on each HomeReady purchase transaction must complete the Framework® online education course (see exception below). The Framework course, available in English and Spanish, meets or exceeds industry standards and consistently receives high marks from learners.
Note for disabled borrowers:
The presence of a disability, lack of Internet access, and other issues may indicate that a consumer is better served through other education modes (for example, in-person classroom education or via a telephone conference call). In such cases, lenders should direct buyers to Framework’s toll-free customer service line (855-659-2267), which can refer consumers to a HUD approved counseling agency.
Framework overview for homebuyers (can be distributed to the borrowers).
Sample email to send to borrowers
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