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homeready home loans glendale az

Fannie Mae is on a mission to make home buying easier in Glendale AZ. With its new HomeReady mortgage, the giant mortgage backer looks to help first time home buyers and repeat buyers alike. This new mortgage program is laser-focused on helping minorities, Millennials, and mixed families on their road to homeownership. 

HomeReady allows borrowers to make a low down payment as little as 3%, either for a home buying or refinancing transaction. Borrowers are also entitled to use a flexible source of funds for both the down payment and closing costs. HomeReady does not require a minimum contribution to come from the borrower’s own source of funds. 

Because HomeReady allows borrowers to make a small down payment, they are required to purchase mortgage insurance, which is a premium that will be added into mortgage payments. HomeReady’s mortgage insurance is affordable and under certain circumstances, it is cancellable. Generally, in order to eliminate mortgage insurance, a borrower’s loan-to-value (LTV) ratio must be above 90%. However, this ratio and restrictions can vary from lender to lender.

What are HomeReady’s borrower benefits in Glendale Arizona?

  • HomeReady serves low-income borrowers.
  • HomeReady features pricing that is better than or equal to standard loan pricing.
  • Lower than standard MI coverage requirements for loans with LTVs greater than 90% up to 97%.
  • Cancellable monthly MI payments (per Servicing Guide policy; generally upon borrower request when the loan
  • balance drops below 80% LTV, or automatically when it drops below 78%).
  • Innovative underwriting flexibilities, including rental unit and boarder income, expand access to credit responsibly.
  • Gifts, grants, and Community Seconds® can be used as a source of funds for down payment and closing costs, with no minimum contribution required from the borrower’s own funds (1-unit properties). Any eligible loan may have more than one Community Seconds (i.e., third lien) up to the maximum 105% CLTV. Cash-on-hand can also be used for down payment and closing costs (1-unit
  • properties).

What are the income eligibility requirements for HomeReady borrowers in Glendale AZ?

  • Effective July 20, 2019, the income limit for all HomeReady loans is 80% of area median income (AMI) for the property’s location, including properties in low-income census tracts. On the HomeReady page, the Income Eligibility Lookup tool provides lenders and other housing professionals with a quick and easy way to determine potential borrower eligibility. Simply use the tool to look up census tract
  • income eligibility by property address or by Federal Information Processing Standards (FIPS) code. Eligibility by census tract is shown in the Income Eligibility by Census Tract Lookup, and income eligibility is identified in Desktop Underwriter® (DU®).

How can lenders determine income eligibility for HomeReady?

For loan case files underwritten through DU, income eligibility is determined based on the area median income of the subject property data, or FIPS code provided on the loan application. A field on the Additional Data screen in the Desktop Originator® (DO®)/DU User Interface gives lenders the ability to enter census tract information if DU is unable to standardize the property address. When the subject address cannot be standardized, and a census tract cannot be determined, but the state and zip code are provided, DU will use the AMI for the county associated to the center location of the zip code provided to estimate HomeReady eligibility. If the subject property is not located in the county identified, the user must provide the complete property address or a complete/updated FIPS code on the loan application and resubmit the loan case file to DU. DU will then use the information provided to determine the census tract or county.

When determining whether a mortgage is eligible under the borrower income limits, lenders must count the income from any borrowers listed on the mortgage note whose income is considered in evaluating creditworthiness for the mortgage loan.
Posted by Nathan Rufty on August 28th, 2019 2:06 PM



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