A new program being offered by the Federal Home Loan Mortgage Corp. enables first-time buyers to obtain a conventional home loan with a tiny down payment.
In a notice Thursday, McLean-Virginia-based Freddie Mac revealed a new 3 percent down payment option for qualified first-time homebuyers.
Dubbed HomeOne, the new program doesn’t have any geographic or income restrictions. In fact, it complements the low-income Home Possible program.
Loans originated for HomeOne need to be underwritten through Freddie’s Loan Product Advisor. Such underwriting provides a complete risk assessment based on several factors as it relates to credit, capacity and collateral.
Only fixed rates are available on the program. In addition, collateral is limited to one-unit properties occupied by the owner.
“The HomeOne mortgage will provide our customers the flexibility they need to help borrowers anywhere in the country achieve the milestone of homeownership and overcome the common down payment resource hurdle,” Danny Gardner, senior vice president of single family affordable lending and access to credit,” said in today’s statement. “HomeOne is a great solution for aspiring homebuyers to grab that first rung of the property ladder and enjoy the financial and social benefits of participating in homeownership.”
The new program will be available on July 29.
