Some first-time homebuyers who cannot qualify for a regular mortgage may be able to get a loan through a program run by the Federal National Mortgage Association (Fannie Mae).
The Community Home Buyer's Program was designed to help low- and moderate-income buyers, according to Geoffrey Smith, director of low- and moderate-income housing for Fannie Mae's Northeast Regional Office, in Philadelphia. He said that typically about two-thirds of the borrowers in such Fannie Mae programs are first-time buyers.
A key benefit of the program is that borrowers may spend up to 33 percent of their gross monthly income on housing payments, including mortgage, taxes, insurance and condominium fees, compared with only 28 percent under standard mortgage plans.
That means buyers who just miss qualifying under a standard mortgage may be able to buy a home under the Fannie Mae program. Total debt payments may be as high as 38 percent of gross monthly income, compared with 36 percent in standard mortgage programs.
The program does not include a common requirement, that buyers have two months' worth of mortgage payments in reserve after closing.
For information, write to Fannie Mae, Public Information Office, 3900 Wisconsin Ave. N.W., Washington, D.C. 20016. Or call 800-732-6643.