Photo by Brina Blum on Unsplash
Low-income borrowers are finding it’s harder to purchase a home now, but a $2,500 credit may very well help them re-think their options.
Fannie Mae announced in January 2024 a $2,500 loan-level price adjustment credit for very low-income purchase borrowers through its HomeReady mortgage program. This credit can be used for down payments and closing costs.
The HomeReady mortgage backed by Fannie Mae requires 3% down and PM. Borrowers must have a qualifying income of less than or equal to 50% of the median income in the area where the property is located.
The credit will be effective for whole loans purchased on or after March 1, 2024, to February 28, 2025.
“The full amount of the $2,500 credit must be provided directly to the borrower through the transaction, such as being applied to down payment and closing costs, including escrows and mortgage insurance premiums,” Fannie Mae said.