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Breaking News Fannie And Freddie Formally Announce 3 Down Programs
“The new lending guidelines released today by Fannie Mae and Freddie Mac will enable creditworthy borrowers who can afford a mortgage, but lack the resources to pay a substantial down payment plus closing costs, to get a mortgage with 3% down. These underwriting guidelines provide a responsible approach to improving access to credit while ensuring safe and sound lending practices.”This is great news to millions of purchasers that have been denied the opportunity to own their own home because of the almost impossible burden of saving for a 20% down payment.
Will these programs create future challenges?Certain pundits fear that low down payment programs will create a wave of foreclosures down the road. Mr. Watt also addressed this concern:
“To mitigate risk, Fannie Mae and Freddie Mac will use their automated underwriting systems, which include compensating factors to evaluate a borrower’s creditworthiness. In addition, the new offerings will also include homeownership counseling, which improves borrower performance. FHFA will monitor the ongoing performance of these loans.”Here are the direct links to the guidelines for each program:
Fannie Mae 3% Down Program
Freddie Mac 3% Down Program
Remember, as with any new program, there will be some confusion as it is unveiled. Contact a mortgage professional for a deeper understanding. Don’t have a mortgage person yet? Contact me for a referral.
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