Fannie Mae Programs
Below is a basic outline of a majority of the current mortgage program initiatives Fannie Mae is currently offering to the general public.
LOW DOWN PAYMENT MORTGAGES
Community Lending Mortgages Requires less income to qualify and less cash for closing than traditional mortgages. Community Lending mortgages help you overcome the biggest obstacles to homeownership – lack of funds for a down payment and having enough income to qualify for a mortgage. These mortgages have special affordability features, including less cash to close – some mortgages, such as MyCommunityMortgage, require borrower contributions as low as $500 – and more flexible qualifying rules. Fannie Mae also considers alternative sources of qualifying income such as boarder income and part-time employment.
MyCommunityMortgage™ Makes it easier than ever to afford a home of your own with just $500 down. MyCommunityMortgage offers extra flexibilities on credit histories, income guidelines, and income sources, plus lower cash reserves. Income restrictions may apply but the restrictions are eased in certain inner-city, high-cost, and rural communities. MyCommunityMortgage also may be used to purchase a 2-4 family home or a home on tribal trust lands; and for teachers, police officers, firefighters, and healthcare workers under Community Solutions. If you have a disability or have a family member with a disability, the Community HomeChoice™ feature offers greater flexibility in qualifying and underwriting standards. (Note: Some Fannie Mae lender partners may call their MyCommunityMortgage options by different names.)
Community Solutions™ Especially for teachers, police officers, firefighters, and healthcare workers. In addition to the low down payment and flexible income guidelines of MyCommunityMortgage, Community Solutions offers a temporary interest rate buy down, acceptance of part-time and overtime income with just a 12-month history, and higher qualifying ratios. Non-traditional credit and employment histories are also considered.
Enhanced Community 2-4 Family Mortgage Designed to make the purchase of properties more affordable for owner-occupants of 2-4 family homes. Enhanced Community 2-Family requires just 3 percent down from your own funds, while Enhanced Community 3-4 Family requires 3 percent from your own funds and 2 percent from flexible sources. A percentage of the rental income you receive may be used to help you qualify for the loan.
Flexible 97® and Flexible 100™ With a Flexible 100 mortgage, you don’t need to make a down payment and can provide as little as $500 of your own money toward closing costs. With a Flexible 97 mortgage, you pay just 3 percent toward your down payment, and this amount can come from sources such as gifts, grants, loans from relatives or nonprofit groups; or employer-assisted housing.
MORTGAGE FOR BORROWERS WITH PAST CREDIT DIFFICULTIES
Expanded Approval™ — If you are concerned about past credit problems keeping you from getting approved for a mortgage and being able to buy a home, Expanded Approval may be for you. With Expanded Approval, lenders can take a broad view of your overall financial situation, not just focus on past credit problems. This way, you can buy a home with a competitive interest rate even if you have a less-than-perfect credit history. In addition, if your lender offers the Timely Payment Rewards® feature, you actually can reduce your interest rate if you make your mortgage payments on time for 24 consecutive months. Many Americans have been able to get into homes with Expanded Approval—so can you!
MORTGAGES FOR OLDER AMERICANS IN NEED OF EXTRA CASH
Reverse Mortgages Primarily designed to strengthen the personal and financial independence of older Americans (homeowners 62 and older). You can borrow against the equity in your home or condo to get cash, and repayment is not required as long as you live in the home and pay insurance and taxes. Fannie Mae offers its conventional reverse mortgage loan, The Home Keeper Mortgage® as well as Home Keeper for Home Purchase, and the Home Equity Conversion Mortgage (HECM), a U.S. Department of Housing and Urban Development (HUD) loan.
HOME CONSTRUCTION AND RENOVATION MORTGAGES
HomeStyle® Construction to Permanent Mortgage Americans are building new homes at record levels. With a HomeStyle® Construction-to-Permanent (C-to-P) Mortgage, you can be one of them. You can finance the purchase of land, construction of a new home, and get a permanent mortgage all at the same time. This saves you money and time by having just one loan approval and one loan closing.
HomeStyle® Renovation Mortgage A cost-effective and convenient way to combine home purchase or refinance with the cost of renovating or repairing your home in one loan with one closing. What’s the benefit? Instead of financing the renovation with a second mortgage or home equity loan, you get the lower interest rate of a first mortgage and only have to pay for one mortgage closing.
Community Renovation™ 1-4 Family This new product may be right for you if you have limited finances and want to purchase and renovate an existing home. Available for single family and 2-4 family properties, this option allows you to make minor renovations and finance the improvements (up to 50% of the as-completed value) in a single mortgage.
SPECIAL OPTION MORTGAGES
Biweekly Mortgage Make a mortgage payment every 14 days, instead of once a month. The result? By making smaller payments more frequently, you will pay off your mortgage sooner and save thousands of dollars in interest over the life of the loan.
Energy-Efficient Mortgage (EEM) Rewards you if you purchase energy efficient homes or renovate existing homes to be more energy efficient. The EEM recognizes that energy efficient homes cost homeowners less to operate on a monthly basis than standard homes because they use less energy. The estimated energy savings are added to your income to allow you to qualify for a larger total mortgage amount. And by increasing your borrowing power, the EEM allows you to include the costs of energy improvements into the total mortgage amount.
InterestFirst™ Are you looking to expand your purchasing power when you buy a home? Are you looking for lower monthly payments in the first years of your mortgage? With an InterestFirst mortgage, you pay only the interest, taxes, and insurance in the beginning years of your mortgage—which means lower monthly payments. And, because the monthly payments are lower, you may qualify for a larger mortgage amount to buy a more expensive home if you choose.
HOMEOWNERSHIP ASSISTANCE INITIATIVES
Employer-Assisted Housing (EAH) An employer-provided benefit that meets important business goals while helping employees with their housing needs, such as understanding the home buying process or down payment or closing costs assistance. If you would like your employer to consider offering an EAH benefit to employees like yourself, you should contact your human resource department and encourage them to contact Fannie Mae’s Consumer Resource Center at 1-800-7FANNIE (1-800-732-6643) for more information.
After reviewing the information, you may contact us if you have questions about applying for a mortgage loan or refinancing. If you have questions about down payment assistance, affordable housing options, workforce housing and/or special needs housing, the following local organizations may be able to provide assistance:
• Housing authority
• County community development commission
• City government’s affordable housing department
• Nonprofit community development organizations
