What Are HomeStyle Mortgage Loans?
HomeStyle Mortgage is Fannie Mae’s equivalent of HUD’s equivalent of the FHA 203k Loan Program. Fannie Mae has a special mortgage loan program called HomeStyle Mortgage. HomeStyle Mortgage Loans is Fannie Mae’s comparable of a FHA 203k Rehab Mortgage Loan . With Fannie Mae’s HomeStyle Mortgage Loan, home buyers can purchase a property in need of rehab and get the financing for the acquisition and the cost of repairs all in one loan just like the FHA 203k Rehab Mortgage Loan. This will allow home buyers to just have one mortgage payment and customize the home repairs to suit their needs and choose whatever upgrades they decide to make on their home purchase.
How Does The HomeStyle Mortgage Program Work
We have covered many mortgage blog article posts on FHA 203k Rehab Home Loans. Fannie Mae’s HomeStyle Mortgage Programs is similar to the FHA 203k Loan Program. Fannie Mae HomeStyle requires that the homeowner work with a Fannie Mae approved housing consultant to determine the repairs you need done on your new home purchase and seek advice from the home consultant on all aspects of the repairs as well as the estimates received by contractors. Your Fannie Mae HomeStyle Mortgages housing consultant can also serve you as a home inspector so you may not need to spend the extra money to hire a separate home inspector to inspect your home purchase.
Advantage of HomeStyle Mortgages Over FHA 203k Rehab Loans
One of the major advantages of Fannie Mae’s HomeStyle Mortgages over a FHA 203k Mortgage Loan is the mortgage insurance premium leeway you have with the HomeStyle Mortgagess Program. HomeStyle Mortgages are conventional loans and conventional loan guidelines apply with regards to mortgage insurance. FHA Loans require that FHA mortgage insurance premium is mandatory over the life of the FHA Loan whereas with conventional loans, as long as you have 80% loan to value, your private mortgage insurance will be canceled. With 30 year fixed rate FHA insured mortgages, it does not matter what your loan to value is because FHA requires mandatory FHA annual mortgage insurance premium for the life of the FHA Loan or until the home is sold or refinanced out and the current FHA Loan is paid off in full.
HomeStyle Mortgage Versus FHA 203k Rehab Loans
Both Fannie Mae’s HomeStyle Mortgages and FHA 203k Rehab Loans are similar in nature. However, FHA Loans have looser and more relaxed lending guidelines. You can qualify fro a FHA 203k Rehab Loan with a 580 FICO credit score whereas you need a 620 FICO credit score to qualify for a Fannie Mae HomeStyle Mortgages. You can have a non-occupant co-borrower with a FHA 203k Rehab Loan where Fannie Mae HomeStyle Mortgage loans do not allow non-occupant co-borrowers. Student loans that are deferred for 12 or more months are exempt from debt to income calculations with FHA 203k Rehab Loans where with conventional loans, you need to count 2% of the student loan balance as a monthly debt payment even if the student loans are deferred for 12 or more months. Both Fannie Mae HomeStyle Mortgages and FHA 203k Rehab Loans are for owner occupant properties only.
Related> FHA 203k Loans
Related> Private Money Capital Group