2. A Comparison of HomeReady and FHA Loan Programs
HomeReady vs. FHA
A Comparison of HomeReady and FHA Loan Programs

3. Down Payment Credit Score
HomeReady
FHA 3%
3.5%
Credit Score
HomeReady
FHA
620
600

4. Maximum Debt-to-income
Income Limits
HomeReady
FHA
Depends on address
None
Qualifying Income
Maximum Debt-to-income
HomeReady
FHA
45% normal; 50% with compensating factors
AUS (DU) determines

5. Example of Rates for 30 year fixed (as of 5/22/2017)
Terms available
HomeReady
FHA
30, 25, 20, 15, 10 year fixed
30 and 15 year fixed
Example of Rates for 30 year fixed (as of 5/22/2017)
HomeReady
FHA
4.00%
(APR 4.911%)
3.625%
(APR 4.738%)

6. Eligible Property Types
HomeReady
FHA
1-4 family
Detached
Condos meeting Fannie Mae Full Review
Townhomes

7. Employment Own Other Property
HomeReady
FHA
2 year work history
Own Other Property
HomeReady
FHA
Yes

8. Mortgage Insurance HomeReady FHA Up Front or Guarantee Fee None 1.75%
Monthly
25% coverage
.85%
Mortgage insurance on HomeReady varies based on factors such as credit score, DTI, etc.

9. Seller Contributions Gifts allowed
HomeReady
FHA
3% of purchase price
6% of purchase price
Gifts allowed
HomeReady
FHA
Yes

10. Non-Occupant Co-borrower
HomeReady
FHA
Allowed – income included in income limit for qualifying income
Yes, family allows for maximum financing
Homebuyer Education
HomeReady
FHA
Yes – only through Framework ($75) No

11. Additional Features HomeReady FHA Non-Borrower Household Income Yes No
Boarder income
Cash on Hand
Non-Borrower Household Income can be use if it is at least 30% of borrower income and a letter stating they will occupy for at least 12 months
Boarder Income can be used if there is a 12 months history (cancelled checks) of this person paying the borrower their portion of the rent. Can be up to 30% of the qualifying income
Cash on hand can be used if it is obvious that the borrower has not used a bank account in a standard method (maybe for cashing checks only)

12. Payment Comparison HomeReady FHA Total Loan Amt 121,250 122,735 Rate
4.00%
(APR 4.911%)
3.625%
(APR 4.738%)
P & I
$578.87
$559.73
Mortgage Ins
$116.20
$84.71
Insurance
$41.67
Taxes
$100.00
Total Payment
$836.74
$786.11
Scenario is based on purchase price of $125,000 on 30 yr fixed
Credit score of 680
Payments based on rate as of 5/22/2017
Up Front Mortgage Insurance financed