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Torres & Co. Lending > First-Time Homebuyer Programs > HomeReady

HomeReady

HomeReady Loan Program

The HomeReady Loan Program, offered through Fannie Mae, is designed to make homeownership more accessible for first-time buyers and moderate-income families. With flexible credit guidelines and a low down payment option, it’s one of the most popular programs for buyers who want to get into a home with confidence and affordability.

What Is HomeReady?

HomeReady is a Conventional loan program that allows borrowers to purchase a primary residence with as little as 3% down. It’s built for buyers who may not have perfect credit or large savings but still want the long-term benefits of homeownership.

How It Works

  • Down Payment: As low as 3%.
  • Credit Score Requirement: Minimum FICO of 620 (higher scores receive better pricing).
  • Income Limits: Household income must be at or below 80% of the area median income (AMI) for the property location. (Check eligibility: Fannie Mae AMI Lookup Tool).
  • Mortgage Insurance: Required if less than 20% down, but it can be cancelled once 20% equity is reached.
  • Property Types: 1–4 unit primary residences, condos, PUDs, and planned manufactured housing.

 

Benefits of HomeReady

  • Low down payment — just 3%.
  • Flexible income sources — rental income and boarder income may qualify.
  • Reduced private mortgage insurance (PMI) compared to standard Conventional loans.
  • Homeownership education course helps buyers prepare for success.
  • First-time and repeat buyers eligible.

Fun Facts & Insider Details

  • Co-Borrowers Allowed: Non-occupant co-borrowers (like parents) can be on the loan to help qualify.
  • Boarder Income: Rental income from roommates can count toward qualification (rare in most programs).
  • Gift Funds: 100% of the down payment can come from gift funds.
  • Reduced MI Coverage:HomeReady requires lower mortgage insurance than many other Conventional loans, making monthly payments more affordable.
  • Education Requirement: At least one borrower must complete Fannie Mae’s
  • Framework Homeownership Education course (unless waived).

Who Is the Best Candidate for HomeReady?

  • First-time buyers with limited savings.
  • Borrowers with moderate income who meet AMI limits.
  • Buyers who want to use rental or co-borrower income to qualify.
  • Anyone who wants a low down payment Conventional option instead of FHA.

FAQs – HomeReady

  • No. HomeReady is for primary residences only.

  • No. Repeat buyers may qualify as long as income limits are met.

  • No. PMI can be removed once you reach 20% equity.

  • Use the Fannie Mae AMI Lookup Tool to check your property’s eligibility.

Next Step

Think HomeReady might be right for you? Let’s confirm eligibility and run the numbers together.

Apply Now

⚖️ Disclaimer: This guide is for educational purposes only. Loan approval and terms depend on credit, income, assets, property type, and program guidelines.

Torres & Co. LendingHomeReady