New loan programs target home buyers with just 3% down—or less

With Fannie Mae’s HomeReady and Freddie Mac’s Home Possible, a 3% down payment — or what lenders refer to as 97% loan-to-value — is available on so-called conventional loans. Conventional loans are the loan products most often issued by lenders.

can i buy a 3m$ house in MV/LA for 3% down? Give me 10 of them!

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You have become biggest bull of real estate, exceeding many here…:joy:

I thought it always go up though, no? :slight_smile:
I just need what, 120K/month income to pay off the debt? Let’s say each rents for 6500-7000, all i need is 50K/month. Piece of cake!

This is all bad. 3% down, 620 credit score, 50% DTI, and first time buyers. YIKES! The try to act like it’s not completely irresponsible by not letting people be at the bottom of all 3 requirements. Overall, these people are the definition of subprime. If they stick to typical conforming limits, then it won’t make a difference in the bay area. Confirming loans are becoming abnormal in Seattle too.

Housing as plenty of buyers. What it needs is more construction.


120k ( or even 50k) per month is a considerable money.

By getting such loans, you must be able to withstand the debt, that is the key. If you have the earning capacity, when there is no rent, to hold debt, it is perfectly fine.

If you can not withstand or hold for 5 to 10 years, it may likely backfire you.

Can the 3% be a seller credit, and buyer agent’s rebate covers closing cost?

Sounds interesting. Maybe I can get my gf to buy a property.

I clearly wont do that… Until the next crisis. Then i might:p

It doesn’t say. It does mention a program that helps with 2%, so the buyer only puts 1% down.

It’s a low risk to buy with 3% down.Your monetary risk is very low if you don’t mind a credit score risk

Ownership is not for everyone. These programs bring in buyers who cannot afford to maintain a property. Not to mention that they likely will walk when zillow tells them that the value dropped 5%.

I sold more than 1 of my rentals to $0 down buyers. I cannot fault them. The last one only paid for the appraisal. His PITI is $100 less than rent. Out of state, not SFBA.

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Where was the rental? in cali?

In the crisis time, i would be interested in getting more loans, and knowing this would probably help :stuck_out_tongue:

They aren’t going to do this for investment properties. It’s for primary residence and first time buyers.

I think first time buyer has a loose definition. I can buy a primary during crisis, and move into that’s fine :slight_smile:
The question is whether they’d support a bay area home (1.5M+, all the way up to 3M).

Doubtful they’d loan above the conforming loan limits. The program isn’t designed to help jumbo buyers.

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That’s what my recollection is on similra programs. But i think i was more or less right on “first time buyer” in that it doesn’t hve to be first time, but don’t know what it actually entails.

Usually it means you can’t currently own a home and haven’t owned a home in that state.

Looks like if you didn’t own a home in 3 years you can take advantage of that, too. wouldn’t apply to me when crisis hits.

  • An individual who has had no ownership in a principal residence during the 3-year period ending on the date of purchase of the property. This includes a spouse (if either meets the above test, they are considered first-time homebuyers).
    – The loop hole might be “principal”. What if it’s a rental?

  • A single parent who has only owned with a former spouse while married.
    – You can divorce on paper, but not really. Probably fraud.

  • An individual who is a displaced homemaker and has only owned with a spouse.

  • An individual who has only owned a principal residence not permanently affixed to a permanent foundation in accordance with applicable regulations.

  • An individual who has only owned a property that was not in compliance with state, local or model building codes and which cannot be brought into compliance for less than the cost of constructing a permanent structure.

There’s an income limit to qualify unless you’re buying in an underserved area… Good luck.