The mortgage giants, Fannie Mae and Freddie Mac, announced that they will start allowing 3% down mortgages!

Even though FHA allows 3.5% down payments on mortgages the PMI (Private Mortgage Insurance) is VERY costly. For a home purchase of $250,000 with 3.5% down the PMI is approximately $230.00 per month. Fannie Mae’s PMI cost is a little over half of that. This results in a savings of about $100 per month.

I am pasting below the guidelines of the changes:

Brief Summary of the Policy Changes

Following is a summary of the policy changes that are more fully described in this Announcement. Fannie Mae
will allow LTV ratios greater than 95% up to a maximum of 97% for:

 MyCommunityMortgage® (MCM®) purchase transactions if at least one borrower is a first-time home
buyer and pre-purchase home-buyer education and counseling is completed,

 standard purchase transactions (non-MCM) if at least one borrower is a first-time home buyer, or

 standard limited cash-out refinances (non-MCM) of existing Fannie Mae loans.

All loans must be fixed-rate and secured by a one-unit principal residence. Manufactured housing is not
permitted. All loans must be underwritten with DU.
In addition, for MCM loans Fannie Mae will now allow reserves to come from gifts.

A link to the complete announcement and guidelines are here.

Bobbie Files, C.D.P.E., Realtor, SUCCESS! Real Estate

Bobbie Files


Contact me about Selling or Buying Your Home in Massachusetts

Bobbie Files is a Real Estate agent at SUCCESS Real Estate, covering the Bristol, Plymouth and Norfolk County areas.