Fannie Mae HomeStyle Mortgage Guidelines And Requirements

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This Article On Fannie Mae HomeStyle Mortgage Guidelines And Requirements

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 an FHA 203k Rehab Mortgage Loan
  • With Fannie Mae’s HomeStyle Mortgage Loan, homebuyers 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

In this article, we will discuss and cover Fannie Mae HomeStyle Mortgage Guidelines And Requirements.

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
  • Homeowners work with the consultant to determine the repairs needed on a new home purchase
  • Homeowners can seek advice from the home consultant on all aspects of the repairs as well as the estimates received by contractors
  • Fannie Mae HomeStyle Mortgages housing consultant can also serve as a home inspector

May not need to spend the extra money to hire a separate home inspector to inspect the home purchase.

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Advantage of HomeStyle Mortgages Over FHA 203k Rehab Loans

One of the major advantages of Fannie Mae’s HomeStyle Mortgages over an FHA 203k Mortgage Loan is the mortgage insurance premium leeway with the HomeStyle Mortgage Program.

  • HomeStyle Mortgages are conventional loans
  • 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
  • With conventional loans, as long as the homeowner has an 80% loan to value, private mortgage insurance can be canceled
  • With 30-year fixed-rate FHA insured mortgages, it does not matter what the loan to value 
  • This 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
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
  • Homebuyers can qualify for an FHA 203k Rehab Loan with a 580 credit score
  • Need a 620 FICO credit score to qualify for a Fannie Mae HomeStyle Mortgages
  • Can have a non-occupant co-borrower with an FHA 203k Rehab Loans
  • Fannie Mae HomeStyle Mortgage loans also permit non-occupant co-borrowers
  • Student loans that are deferred for 12 or more months are no longer exempt from debt to income calculations with FHA 203k Rehab Loans
  • With conventional loans, Income-Based Repayment (IBR) can be used as long as the IBR Payments reflect on borrowers credit reports

Both Fannie Mae HomeStyle Mortgages and FHA 203k Rehab Loans are for owner occupant properties only.

Related> Rehab Loans

Related> What is a FHA 203k Loan?

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