Get ready, set, And Go!    My Community Mortgage Program is Back.

Get ready, set, And Go! My Community Mortgage Program is Back.

It is official!   wr-df-refinance-7Both government-sponsored enterprises Fannie Mae and Freddie Mac announced their individual 97% loan-to-value products, in the government’s latest attempt to expand the credit eligibility for first-time homeowners.

Back in October, the Federal Housing Finance Agency announced a number of policy steps aimed at increasing mortgage credit availability

These new lending guidelines were released today by Fannie Mae and Freddie Mac and will enable creditworthy borrowers who can afford a mortgage, but lack the resources to pay a substantial down payment plus closing costs, to get a mortgage with only 3% down.

Fannie’s My Community Mortgage product with a 3% down payment will be available now through desktop under writing tool starting  the weekend of December 13, 2014. Fannie defines a first-time buyer as someone who hasn’t had primary residence in the last three years.

Fannie Mae and Freddie Mac’ underwriting systems includes as well compensating factors to evaluate a borrower’s creditworthiness who can afford a house payment.

These products come at the right time as top housing economists predict 2015 to be a significant year for the housing market.

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New Mortgage guidelines in effect since December 1st !

New Mortgage guidelines in effect since December 1st !

WASHINGTON-MAY 23: Fannie Mae's mortgage portfolio shrank at 19%Fannie Mae and Freddie Mac launched their new mortgage guidelines that went into effect last December 1st, now requiring a much lower down payment. From the previous 5% to 3% in what lenders hope will be a good kick start from a sluggish housing market that we have seen lately.

Now the brain trust at WalletHub has released its 2014 Mortgage Insurance Report to help low-down-payment home buyers save up to $12,000 on their decision between a Federal Housing Administration loan and private mortgage insurance.

On the other hand FHA premiums, unlike private mortgage insurance, continue to be assessed throughout the life of a loan, even if the loan to value ratio drops below 80%. This creates a huge cost disparities over time, between private mortgage and the FHA option.

New mortgage guidelines are expected to significantly increase the availability of more new purchases.