3% Down Conventional

1. 3% Down Payment To Qualify For 97 LTV Conventional Loan

* The surprising announcement released by Fannie Mae and Freddie Mac now will give the opportunity for home buyers who qualify for a conventional loan

- 97% Conventional Loan program is ideal for home buyers who afford the mortgage payments and housing expenses but lack the needed 5% down payment
- Now they can have an opportunity to purchase a home and to be able to only put a 3% down payment to qualify for a 97 LTV Conventional Loan
- The 3.0% down payment requirement for the conventional loan is lower than the 3.5% down payment required for an FHA Loan
- The 0.50% reduction in a down payment required on a home purchase can be a significant amount especially on higher priced homes

2. Conventional Loan Requirements

* To qualify for a conventional loan, borrowers need the following:

- Need a 620 credit score
- Debt to income ratios are capped at 50% DTI
- There is a mandatory waiting period of 4 years after a bankruptcy, deed in lieu of foreclosure, and short sale
- There is a 7 year mandatory waiting period after a foreclosure
- Need to have been timely on payments in the past 12 months
- Need an approve/eligible per DU FINDINGS and/or LP FINDINGS per Automated Underwriting System

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