Fannie Mae HomeReady
Fannie Mae's affordable 3%-down loan for low-to-moderate-income buyers. It carries cheaper mortgage insurance than a standard conventional loan and counts flexible sources of income.
- Down payment
- 3% down.
- Credit context
- Usually needs a score around 620. Mortgage insurance is required under 20% down but is reduced versus a standard conventional loan and cancels with equity.
- Income rules
- Your income generally must be at or below 80% of the area median. Income from household members can sometimes help you qualify.
Individual lenders set the interest rate, fees, mortgage-insurance treatment, and final approval requirements. Compare written Loan Estimates before choosing.
How repayment works
Your monthly housing payment usually includes principal and interest, and may also include property taxes, homeowners insurance, mortgage insurance, and association fees. Your lender’s written Loan Estimate and Closing Disclosure control the actual costs and terms.
A lower advertised down payment does not necessarily mean the lowest monthly payment or lowest total cost.
Who it may fit
- First-time buyers who want a clearer path
- Households balancing two credit profiles
These are situations worth exploring, not a qualification decision.
What could rule it out
- Household income may not exceed 80% of area median income for the property location.
Costs and terms to confirm
- Cash needed
- 3% down.
- Credit
- Usually needs a score around 620. Mortgage insurance is required under 20% down but is reduced versus a standard conventional loan and cancels with equity.
- Income
- Your income generally must be at or below 80% of the area median. Income from household members can sometimes help you qualify.
Ask each lender for the interest rate, annual percentage rate, lender fees, mortgage insurance, cash to close, and total payment using the same assumptions.
Can I combine this with assistance?
Conventional loans pair with assistance through "Community Seconds"-style rules
- Fannie Mae and Freddie Mac publish rules (Community Seconds / Affordable Seconds) under which a qualifying assistance second lien can sit behind a conventional first mortgage.
- The assistance program must meet those published criteria — most established government and nonprofit programs are structured to.
- Low-down-payment conventional options designed for first-time buyers (3%-down programs) commonly combine with assistance, subject to the lender's approval of the specific pairing.
Family gift funds: Gift funds from family are broadly allowed, with documentation requirements similar in spirit to FHA's.
Confirm: Whether a specific program is approved as a Community Second is a lender-and-program question — ask the program for its participating-lender list, and the lender which programs they close with.
Source: CFPB — Buying a House (conventional loan options). The lender and program administrator make the final decision for a specific pairing.