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Freddie Mac Home Possible

Min. Credit Score 620 Min. 3% Down Payment

Want to buy a home but have trouble saving for a large down payment? Freddie Mac's Home Possible mortgage program may be a solution. Designed to make homeownership more accessible, Home Possible offers lower down payment options and reduced closing costs. This means you can buy a home sooner and spend less money upfront. Plus, the program offers flexible loan terms to meet your unique needs.

Program features
  • Loan amounts up to $802,650
  • Debt-to-income (DTI) ratio up to 50%
  • Household income at or below 80% of the Area Median Income (AMI)
  • Homebuyer education is required for first-time buyers
  • 1-4 units, condos, co-ops, and planned-unit developments; manufactured homes with restrictions
Why choose our Freddie Mac Home Possible?
  • Ability to lower your monthly payments with a temporary rate buydown option
  • Cancelable Mortgage Insurance (MI)
  • Certain credit fees are capped
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Program details

Loan amounts up to $802,650
Debt-to-income (DTI) ratio up to 50%
Cancelable Mortgage Insurance (MI)
Minimum 3% down payment
Primary residence only
Limited cash-out refinance is allowed
Qualifying income is limited to 80% of Area Median Income (AMI)
No reserves are required for one-unit properties; two months are required for two- to four-unit properties
Financing from family members, employer-assistance programs, secondary financing, and sweat equity are acceptable as down payment sources and closing cost assistance
PMI (private mortgage insurance) is required if down payment is less than 20%
Manufactured housing (with certain restrictions), one- to four-unit properties, fee simple homes, condominiums, co-ops, and planned unit developments
15- and 30-year fixed-rate terms
Available to non-permanent residents
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Freddie Mac Home Possible FAQ

What is a Freddie Mac Home Possible mortgage?

A Freddie Mac Home Possible mortgage is a loan program designed to help low- to moderate-income buyers achieve homeownership. It offers benefits like lower down payment requirements, reduced closing costs, and flexible loan options to make homebuying more affordable.

Who qualifies for a Home Possible mortgage?

To qualify for a Home Possible mortgage, you generally need to meet the following criteria:
– Your household income must be at or below 80% of the Area Median Income (AMI) for the area where you’re buying the home (to find out if you meet this, you can look it up using Freddie Mac’s Area Median Income and Property Eligibility Tool)
– You typically need a credit score of at least 620
– You need to make a down payment of at least 3% of the home’s purchase price
– The home must be your primary residence

What are the benefits of a Home Possible mortgage?

Lower down payment requirements compared to traditional mortgages
– Reduced closing costs
– Flexible loan options to fit your needs
– Potential for down payment assistance programs
– Access to homebuyer education resources

How much down payment is required for a Home Possible mortgage?

Typically, a Home Possible mortgage requires a down payment of just 3% of the home’s purchase price. However, there may be options for lower down payments or down payment assistance programs available in your area.

Can I use a Home Possible mortgage as a first-time homebuyer?

Yes, the Home Possible mortgage is specifically designed to help first-time homebuyers achieve their homeownership goals. However, it’s also available to repeat homebuyers who meet the program’s income requirements.

Are there income limits for a Home Possible mortgage?

Yes, there are income limits based on your location. These limits are determined by the area median income (AMI). To see if you qualify, you can use Freddie Mac’s Home Possible Income & Property Eligibility Tool.

Can I qualify for a Home Possible mortgage if I own another property?

Yes, the occupying borrower may have an ownership interest in an additional financed residential property.

Do I have to be a first-time homebuyer to qualify for a Home Possible mortgage? 

No. The Home Possible mortgage is available to all qualified borrowers whose income does not exceed 80% of the Area Median Income (AMI).

As a Home Possible borrower, do I have to occupy the home I purchase as my primary residence?

No. Non-occupant borrowers are permitted on one-unit properties that meet the LTV ratio requirements in the Guide. However, at least one borrower must occupy the property as their primary residence.
Note: The income of non-occupant borrowers is included in the AMI calculation.

If no borrower on a loan application has a credit score, are the borrowers eligible for a Home Possible mortgage? 

Borrowers without a credit score can qualify for a Home Possible mortgage, provided the LTV/TLTV/HTLTV ratio for the mortgage does not exceed 95 percent.

Do all Home Possible borrowers need to take a homeownership education course?

No. Homeownership education is required only for a purchase mortgage when all borrowers are first-time homebuyers or if the credit reputation for all borrowers is established using only Noncredit Payment References. In both instances, at least one borrower must complete a homeownership education program for a purchase mortgage before the mortgage’s note date.

Is homeownership education required for a Home Possible refinance transaction?

No. Homeownership education is not required for Home Possible mortgages that are refinances.

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12/24 Month Bank Statement

Min. Credit Score 620 Min. 10% Down Payment
  • Personal, business, or combined bank statements
  • Only 3 months of reserves required
  • ITIN is available
  • Minimum credit score 620

FHA Standard

Min. Credit Score 620 Min. 2.25% Down Payment
  • Loan amounts up to $498,257
  • Debt-to-income (DTI) ratio up to 55%
  • Minimum 2.25% down payment
  • Owner occupied only