This guide covers Freddie Mac HomeOne Mortgage Guidelines for first-time homebuyers. Freddie Mac has come out with a new Loan program called Freddie Mac HomeOne Mortgage to help first-time home buyers. This program is designed to attract clients who may be looking into low down payment options, such as FHA mortgages. In 2025 it is estimated that over half of home buyers are first-time home buyers making the Freddie Mac HomeOne Mortgage Program very attractive.
Freddie Mac HomeOne Mortgage For First Time Buyers allows first time home buyers to use a 3% down payment. It also will provide them with an educational course on what to expect during the loan process and homeownership in general.
This educational course will give first time home buyers the tools for successful homeownership. Freddie Mac HomeOne Mortgage will be available on single-family homes, townhouses, and condos. Freddie Mac HomeOne Mortgage is very similar to Fannie Mae’s HomeReady program. Let’s go into more detail now. This guide provides an in-depth examination of Freddie Mac HomeOne Mortgage, outlining its key features and benefits for first-time homebuyers. In the following paragraphs, we will discuss and cover Freddie Mac HomeOne mortgage guidelines for first-fime homebuyers.
What Does Freddie Mac HomeOne Mortgage Mean?
The Freddie Mac HomeOne mortgage offers a low down payment and flexible qualification criteria, making it suitable for first-time homebuyers. Cash-out refinancing is not allowed. With a 3% minimum down payment, no geographic or income restrictions, and a focus on owner-occupied properties, HomeOne is widely used. Unlike government-backed loans, it has unique mortgage insurance requirements and long-term costs. Private mortgage insurance (PMI) may be discontinued once the loan balance reaches 80% of the home’s original value.
Guidelines on Freddie Mac HomeOne Mortgage for First-Time Homebuyers
The Freddie Mac HomeOne mortgage is designed for buyers seeking a low down payment. First-time homebuyers may qualify with as little as 3% down and no income restrictions. Available nationwide, the program allows borrowers to take up to 97% of a home’s value for owner-occupied properties, making homeownership more accessible.
Applicants should review occupancy requirements, mortgage insurance, approval criteria, and first-time buyer qualifications to assess suitability.
HomeOne is a potential alternative to FHA loans for buyers seeking a conventional mortgage with lower costs. Common questions include comparisons between HomeOne and FHA loans, whether all borrowers must be first-time buyers, and whether private mortgage insurance (PMI) can be removed. The best mortgage product depends on individual needs, loan features, and financial goals.
What Are The Qualifying Criteria For A Freddie Mac HomeOne Mortgage?
Eligibility for a HomeOne loan. To qualify for a HomeOne loan, at least one borrower must be a first-time homebuyer purchasing an owner-occupied property and must not have owned a home in the past three years. Single parents and homemakers may qualify for certain exceptions. If all borrowers are first-time buyers, at least one must complete a homeownership education course before closing. For Freddie Mac, is someone who:
- is buying the home
- will be living in the home as a primary residence
- has not owned a home in the last 3 years
This definition is broader than many assume. Individuals who sold a previous home and have rented for at least three years may qualify again as first-time buyers.
Down Payment Requirements For Freddie Mac HomeOne Mortgage
A key advantage of the Freddie Mac HomeOne mortgage is the ability to borrow up to 97% of a home’s value with only a 3% down payment. Dale Elenteny, a senior loan officer and an associate contributing editor at GCA Forums News says the following:
In some cases, combining with another approved loan may allow borrowing up to 105% of the property’s value. HomeOne is intended for buyers with stable income and strong credit, even with limited savings.
HomeOne has no geographic or income restrictions. In contrast, Freddie Mac Home Possible limits income eligibility to 80% of the area median. HomeOne is suitable for applicants seeking a 3% down payment without income limits.
First-Time Homebuyer? See If HomeOne Is Your Best Option
We’ll review your credit, income, and down payment to confirm if HomeOne fits—or if another 3% down option (like HomeReady or FHA) makes more senseProperty Criteria For Freddie Mac HomeOne Mortgages
The Freddie Mac HomeOne mortgage is limited to one-unit, owner-occupied properties. Manufactured homes may qualify if they meet CHOICEHome criteria. The program covers single-family homes, townhouses, and condominiums that meet Freddie Mac’s standards. HomeOne is not available for all property types. Multi-unit properties, second homes, and investment properties require different loan products. Review all mortgage options before making a selection. Freddie Mac requires that all borrowers live in the home as their primary residence. HomeOne is not available for second homes or investment properties.
Freddie Mac HomeOne Mortgage Insurance Criteria
Because HomeOne allows a down payment of less than 20%, mortgage insurance is typically required. Freddie Mac says standard 35% mortgage insurance coverage is required for LTVs above 95%.
The CFPB also states that, for conventional loans, if the borrower puts down less than 20% of the purchase price, the borrower will also have to pay private mortgage insurance (PMI).
Private mortgage insurance protects the lender and increases the borrower’s monthly payment. For most borrowers, PMI is a standard part of low-down payment loans and is not a major concern with HomeOne. It is important to ensure that total monthly payments align with long-term financial plans.
Is It Possible To Get a PMI-Free HomeOne Mortgage With Freddie Mac?
In many instances, yes. The CFPB explains that many qualifying mortgages on single-family principal residences allow the borrower to request PMI cancellation once the principal balance drops to 80% of the home’s original value, provided the loan meets the required conditions. The option to remove PMI is a key reason some borrowers choose HomeOne over FHA loans. FHA mortgage insurance works differently and often lasts longer, depending on loan terms and the down payment. The best mortgage product depends on credit profile, payment history, expected length of residence, and eligibility.
Benefits Of Freddie Mac HomeOne Mortgage
Explore updated Freddie Mac HomeOne mortgage guidelines, including 3% down payments, PMI, first-time buyer requirements, occupancy rules, and eligibility criteria.
Who Can Use Freddie Mac HomeOne Mortgage Program?
- HomeOne Mortgage is for first time home buyers
- It also benefits homeowners who want to complete a no cash-out refinance
- Borrowers trying to buy (or refinance) a single-family house, townhouse, or condo
At Least One Borrower Must Be A First-Time Homebuyer:
- Freddie Mac describes a first-time home buyer as a borrower who did not have ownership interest (joint or sole) in a residential property during the three years preceding the date of the new purchase
- The applicant is purchasing the mortgaged property
- This applicant must also reside in the property
NOTE: Even if one borrower owns another home, Freddie Mac HomeOne Mortgage only requires one borrower to meet the definition of a first-time homebuyer as stated above.
Features Of Freddie Mac HomeOne Mortgage
What are some unique features of the Freddie Mac HomeOne mortgage program?
- Unlike low down payment programs we have seen in the past, HomeOne Mortgage does not have any geographical or income restrictions
- Only require a 3% down payment, 97% LTV
- Can go up to 105% LTV with an “Affordable Second”
- Credit underwriting must pass Loan Product Advisor (LP) with a risk class of ACCEPT
- NO MANUAL UNDERWRITING
- At least one applicant on the application must have a usable credit score
- The mortgage insurance cancelable oh, unlike FHA loan phone
Homeowners may cancel private mortgage insurance once the property equity reaches 20% or what is called 80% LTV.
To Qualify For A HomeOne loan, Your Application Must Be Approved By Freddie Mac’s Loan Product Advisor System. Only Fixed-Rate Loans Are Eligible
HomeOne is a unique Freddie Mac program with its own eligibility criteria, separate from other low-down-payment loans. Approval is based on a full financial assessment, including credit, income, debts, savings, property type, and automated underwriting. Most first-time buyers use this program to purchase a home. For refinancing, the existing loan may need to be owned by Freddie Mac, depending on the loan balance and property value.
Comparison of Freddie Mac HomeOne and Home Possible
HomeOne and Home Possible are often compared for their low down payment requirements. The main difference is that HomeOne has no income limits, while Home Possible is for lower-income borrowers and usually restricts income to 80% of the area median. Both require only a 3% down payment, but eligibility criteria differ. Freddie Mac HomeOne Mortgage is accessible to a broad range of buyers and is particularly advantageous for first-time purchasers seeking a conventional loan. It is most suitable for those seeking a 3% down payment, no-income restrictions, and owner-occupied properties. The absence of income limits enhances accessibility.
The HomeOne mortgage is not always the one with the lowest down payment. Factors such as monthly payments, PMI, property value, savings, creditworthiness, and anticipated duration of residence should be considered.
HomeOne is well-suited for buyers with strong credit and limited savings. For those with weaker credit, FHA loans may be preferable, while Home Possible may benefit applicants with incomes below the area median. This guide addresses common questions regarding program operation, eligibility, and comparisons with FHA loans. HomeOne is a 3% down conventional loan for first-time buyers without income limits, but applicants must meet requirements for occupancy, fixed-rate loans, one-unit properties, mortgage insurance, and approval through Freddie Mac’s system.
Why Should First-Time Homebuyers Look Closely At HomeOne?
Qualification is determined by credit score, debt-to-income ratio, down payment, property type, and automated underwriting. The Freddie Mac HomeOne mortgage is an attractive option for first-time buyers because of its flexible terms. Qualified applicants can secure a loan with a 3% down payment, no income restrictions, and a fixed rate for an owner-occupied property. When considering HomeOne, compare it with FHA loans and other low-down-payment options to find the best fit for your financial situation. Only one borrower must be a first-time homebuyer.
Mortgage Refinance Basics
HomeOne Mortgage Refinance Basics:
- NO CASH-OUT REFINANCE MORTGAGES ONLY
- For LTVs (Loan-To-Value Ratio) above 95%, the mortgage being refinanced must be securitized by Freddie Mac
- This means current loan must already be a Freddie Mac Mortgage
- For TLTVs (Total Loan-To-Value Ratio) above 95% and secondary financing IS NOT an Affordable Second, the current mortgage being refinanced must be owned by Freddie Mac
- For TLTVs (Total Loan-To-Value Ratio) above 95% and secondary financing IS an Affordable Second, The mortgage being refinanced does not have to be owned by Freddie Mac
The Following Loan Features Are Not Allowed On HomeOne Mortgage Loans:
- Adjustable-rate mortgages
- Cash-out refinance loans
- Super conforming loans
- Mortgages on second homes or investment properties
Frequently Asked Questions on Freddie Mac HomeOne Mortgage Loans
What Is The Required Down Payment For A Freddie Mac HomeOne Mortgage?
HomeOne allows first-time homebuyers to qualify with as little as 3% down, offering up to 97% loan-to-value.
What Are The Income Limits For Freddie Mac HomeOne?
Freddie Mac HomeOne has no income limits.
Is There Mortgage Insurance Required On A Freddie Mac HomeOne Loan?
Yes, unless the down payment is 20% or more. Mortgage insurance is required at the standard 35% coverage for LTV ratios above 95%, as explained by the CFPB. Conventional loans typically require mortgage insurance with less than 20% down.
What Are The Eligible Property Types For Freddie Mac HomeOne?
HomeOne is intended for one-unit primary residences. Manufactured homes are not eligible unless they are CHOICEHome properties.
What Is Required For A HomeOne loan?
If all borrowers are first-time homebuyers, one must complete a homeownership education course before the note date.
