Site icon Ask Carolyn Warren

Buying a House with 3% Down

My favorite loan for people who need a minimal down payment is called HomePossible or HomeReady.

It is a 30-year fixed rate conventional loan. HomePossible is backed by Freddie Mac and HomeReady is backed by Fannie Mae. These loans have the identical requirements and identical interest rate, so either one is awesome.

Here’s why I love this loan:

  1. Only 3% down and the seller can pay some or all of your closing costs.
  2. You get the same interest rate as if you were putting 20% down.
  3. You get a reduced monthly mortgage insurance payment.


To check the income limit for your area, you must input an actual address into the search space. You can check it here.

If your income is too high to qualify, then take the 5% down conventional loan instead.

If your credit score is too low to qualify, take the 3.5% down FHA loan instead.

REMEMBER: Always get preapproved with your mortgage broker before making an offer on a property.

REMEMBER: Get a licensed real estate agent to present your offer and negotiate terms. The Buyer’s agent is free to you (paid by the seller), and everyone needs the advantage of a professional real estate advocate to avoid costly mistakes.

Exit mobile version