Conventional Low Down Payment Loan. Down Payment As Low 3%

Use the Fannie Mae HomeReady, Freddie Mac HomePossible, or HomeOne Loan to Achieve Your Dream of Homeownership

With Millennial Home Loans quick online loan application, determining if you qualify for a Conventional Low Down Payment Loan and for how much, has never been easier.

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3% Down Loan Program Guidelines

Loan Purpose

  • Purchase
  • Refinance: Limited Cash Out Refinance

Credit Profile

  • 620 minimum middle credit score for all borrowers on the loan
  • Desktop Underwriting findings must be "Approved/Eligible" and Loan Prospector findings must be "Accept"
  • Waiting period after a major negative credit event
    Conventional Loan TypeBK – Chapter 7BK – Chapter 13 DischargedBK – Chapter 13 DismissalForeclosure*Short Sale, Deed-In-Lieu, Pre-ForeclosureModified Mortgage
    Standard4 years2 years4 years7 years4 years2 years
    With Extenuating Circumstance2 years2 years5 years3 years (requires 10% down)2 yearsNo waiting period

    * If a property was included AND surrendered (i.e. property wasn’t retained and the debt wasn’t reaffirmed) in a Chapter 7 Bankruptcy, the borrower may potentially be able to defer to the Chapter 7 waiting period Vs. the Foreclosure waiting period.

Income Restrictions

  • There are no income restrictions for the Freddie Mac Home One loan program
  • Fannie Mae Home Ready and Freddie Mac Home Possible Loan programs restrict household income to 100% of the AMI for the property location
  • Income is based on income of the borrowers on the loan, including co-signers if allowed
  • Income of the household is not evaluated
  • Lookup tools to determine income restrictions:

Loan Amount

  • Loan amount not to exceed 2019 conventional loan limits of $647,200 or if the property is in a High Balance area the FHFA Conforming Loan Limits

Ratios

  • As determined by Automated Underwriting System. Requires a Desktop Underwriter "Approved/Eligible" and Loan Prospector findings must be “Accept” findings

Property Type

  • Owner-occupied only
  • 1 to 4 unit properties
  • Fannie Mae/Freddie Mac approved condos
  • PUD's (i.e. Townhomes)
  • Log cabin homes provided Appraisal Report lists other comparable log cabin homes that have recently sold in the area

Documentation

  • All loans must be fully documented per Agency Guidelines
  • For Self Employed borrowers, in addition to Agency Guidelines, two years of the tax returns (personal and business) along with a year-to-date profit and loss (unaudited)

Down Payment/Closing Costs - Purchase

  • Minimum down payment on a purchase transaction and equity position on a refinance transaction, based on transaction type:
    • Primary residence:
      • conventional loan limits: 3% (requires that all borrower(s) occupy the property and for purchase transaction that at least one borrower must be first time homebuyer)
      • high balance loan limits: 5%
      • conventional loan limits – two to four-unit property: 5%
  • Seller contribution toward buyers closing costs and escrows from 3 to 6% of the purchase price

Terms

  • Amortization period: 15 and 30-year fixed rate