|Feature||Home Possible||Home Possible Advantage|
|Eligible Mortgage Products||
|Maximum LTV/TLTV Ratios||
|Eligibility/Underwriting||A Home Possible mortgage may be submitted to Loan Prospector® or may be a manually underwritten mortgage. See Guide Section A34.8 for credit underwriting requirements.|
|Requirements for Minimum Borrower Contribution and Sources of funds||See Guide Section A34.10 for requirements on minimum contributions from borrower personal funds, reserves and permitted sources of funds.|
|Homebuyer Education||See Guide Section 34.12 for homeownership education and landlord education requirements related to:
|Delivery Fees||See Guide Exhibit 19 for:
|Special Delivery Requirements||See Guide Section 17.18(b) for special delivery instructions for Home Possible mortgages.|
|Single-Family Seller/Servicer Guide||Refer to Guide Chapter A34.|
Key Features and Flexibility
- Fixed-rate mortgages with a term of up to 30 years.
- Eligible properties: one-unit properties, condominiums, and planned united developments. (Manufactured homes are ineligible.)
- All borrowers must occupy the property as their primary residence.
- Maximum loan-to-value (LTV) is 97% and maximum total loan-to-value (TLTV) is 105%.
- Reduced mortgage insurance coverage (18%).
- Temporary Subsidy Buydown plans lower initial monthly payments.
- No reserves required.
- More eligible sources of funds for down payment and closing costs.
- Eligible annual income up to 100% of Area Median Income or higher in select counties and no income limit in underserved areas.
- May be submitted through Loan Prospector® or manually underwritten
- No minimum borrower contribution from borrower personal funds.
- Gift from related persons and other sources of funds permitted for down payment and closing costs.
- Lower monthly payments from reduced mortgage insurance coverage levels.
- Lower monthly payments means less income needed to qualify.
- No minimum LTV limit.
- No reserves required, lowering cash needed to close.
- Flexible closing cost funding options.
Home Possible Advantage or FHA?
Comparison of Home Possible Advantage with monthly PMI vs. FHA using $150,000 sales price.
|30-year fixed rate mortgage scenario||Home Possible Advantage
18% Monthly MI Coverage
4.375% Note Rate**, 97% LTV
FICO Ranges 680-719 / 720-759
|FHA No FICO Cuts 3.750% Note Rate* 96.5% LTV|
|Base Loan Amount||$145,500||$144,750|
|Upfront MIP Rate (%)||0||1.75%|
|Upfront MIP Cost ($)||0||$2,533|
|Total Loan Amount||$145,500||$147,283|
|Monthly MI Rate (%)||.80%/ .60%||0.85%|
|Monthly MI ($)||$97/$73||$102|
|Total Monthly Payment||$823/$799||$784|
The Freddie Mac Home Possible advantage mortgage could be a great option. Call today to get more information and started on the loan process today!