97% ltv comparison chart

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97 % Financing Options Comparison Chart Comparing Fannie Mae HomeReady / Fannie Mae Standard 97 / Fannie Mae

MyCommunity / Freddie Mac HomePossible Advantage

Product Feature Fannie Mae HomeReady Fannie Mae Standard 97 Fannie Mae MyCommunityMortgage

(available until Dec. 2015)

Freddie Home Possible Advantage

Loan Purpose: Purchase Purchase or a Limited Cash-out Refinance

Purchase Purchase

Occupancy 1-Unit Principal Residence 1-Unit Principal Residence 1-Unit Principal Residence 1-Unit Principal Residence

LTV Limits 95.01-97% for 1 Unit 95.01-97% for 1 Unit Purchase; for Limited Cash-out Refinance current lien must be an existing Fannie Mae Loan

95.01-97% for 1 Unit 95.01-97% for 1 Unit

Product Fixed Rate Fixed Rate Fixed Rate Fixed Rate

Income Limits No Income Limits in low-income census tracts (defined as < 80% of AMI)

100% of Area Median Income in High-Minority Census Tracts or Designated Disaster Areas

80% AMI in other tracts

No Income Limits < 100% AMI with higher income limits to 115% of AMI for non-metro areas

< 100% AMI with higher income limits to 115% of AMI for non-metro areas No Income Limits if property located in an Underserved area

Ownership of other property

Occupant borrower may not have any ownership in any other residential property at time of closing




Non-Occupant Co-Borrowers

Permitted w/ reduction in LTV to 95% - income included in qualifying

Permitted w/ reduction in LTV to 95% - income NOT included in qualifying

Not Permitted Not Permitted




Manufactured Housing Permitted w/ reduction in LTV to 95% - temporary buydowns not allowed

Permitted w/ reduction in LTV to 95% - temporary buydowns not allowed

Not Permitted Not Permitted

Renovation Options Permitted w/ reduction in LTV to 95% - must be approved to deliver HomeStyle Renovation loans

Permitted w/ reduction in LTV to 95% - must be approved to deliver HomeStyle Renovation loans

Not Permitted Permitted subject to LTV reduction to 95%

Buydown Options 3-2-1 and 2-1 Temporary Buydowns allowed

3-2-1 and 2-1 Temporary Buydowns allowed

2-1 Temporary Buydowns Only

3-2-1 and 2-1 Temporary Buydowns allowed

Non-Borrower Household Income

Permitted as a compensating factor in DU to allow a DTI ratio greater than 45% up to 50% - non-borrower income is NOT considered qualifying income

Not Permitted Not Permitted Not Permitted

Boarder Income Permitted with documentation of at least 9 of most recent 12 months (averaged over 12 months) – up to 30% of qualifying income maximum

Not Permitted Permitted with 12 months’ of receipts and up to 30% of qualifying income

Not Permitted

Accessory Dwelling Units Rental Income allowed on a 1-unit property with an accessory unit – follow existing rental income guidelines for documentation and calculation

Not Permitted Not Permitted Not Permitted




Homeownership Education

Required prior to Note Date for at least one borrower – through Framework

Required prior to Note Date for at least one borrower when all borrowers are relying solely on nontraditional credit to qualify (LTV restricted to 95% since manual underwriting would be required)

Required prior to Note Date

Required for at least one qualifying borrower if all borrowers are First-Time Homebuyers

Mortgage Insurance 25% Coverage 35% Coverage 18% Coverage 18% Coverage

Secondary Financing Allowed to a CLTV of 105% with Community Seconds

Allowed to a CLTV of 105% with Community Seconds

Allowed to a CLTV of 105% with Community Seconds

Allowed to a CLTV of 105% with an Affordable Second

Underwriting Options DU only when LTV 95.01-97%

DU only when LTV 95.01-97%

DU only when LTV 95.01-97%

LP only when LTV 95.01-97%

Borrower Minimum Contribution

None None None None

First Time Homebuyer Requirement

Not Required Required Required Not Required

Loan Limits High Balance not eligible High Balance not eligible High Balance not eligible High Balance not eligible

Reserves Per AUS Per AUS Per AUS Per AUS

Qualifying Ratios Per AUS Per AUS Per AUS Per AUS

97% ltv comparison chart

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