January 8th, 2015 7:59 AM by Jackie A. Graves, President
In a previous post, we answered your top questions about Freddie Mac's new
affordable mortgage with a down payment option as low as 3% - Home Possible Advantage(SM).
Since lenders will soon begin taking applications, today we're
I have to be a first-time homebuyer?
No, Home Possible Advantage is available to all eligible low- and
moderate-income borrowers – including first-time homebuyers.
Do I have to live in the house or can I use this mortgage to buy a
Home Possible Advantage mortgages require the borrower to live in the home.
Am I required to get housing counseling?
To qualify for Home Possible Advantage, first-time homebuyers (borrowers who've
had no ownership in a residential property during the last three years) are
required to participate in an acceptable borrower education program, like
Freddie Mac's CreditSmart®.
What if my credit is less than the 660 requirement?
A credit score of
660 is required for Home Possible Advantage mortgages (680 for refinances) that
are underwritten manually by a lender. However, we expect the majority of these
loans to be underwritten using our automated underwriting system Loan
Prospector – which assesses a prospective loan’s eligibility for sale to us
based on our credit guidelines.
Loan Prospector provides the broadest opportunity to participate
in Home Possible Advantage because it considers
compensating factors to determine eligibility. So weakness in one area –
like a lower credit score – does not necessarily disqualify a borrower because
one or more positive factors may compensate for another.
do I know if I am below the media area income?
Home Possible Advantage was designed to increase access to credit for low- and
moderate-income borrowers based on the Area Median Income estimates issued by
the Federal Housing Finance Agency each year. See how your
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