While the FHA mortgage is backed by the federal government, HomeReady and Home Possible are backed by private lenders Fannie Mae and Freddie Mac. Since they’re conventional mortgages owned by a private lender, there is more flexibility with down payment requirements and credit history.
Furthermore, do I qualify for HomeReady?
Income limits: Borrower income must be below 100 percent of the area median income (AMI), with some exceptions based on the property’s location. There is no income limit on properties in low-income census tracts. Credit: HomeReady allows for nontraditional credit. Credit scores as low as 620 are permitted.
In respect to this, is HomeReady better than FHA?
A benefit of HomeReady is that even if your LTV is above 90% (up to 97%!), the standard PMI coverage requirements can be reduced, and when your LTV reaches 80%, you can request to have your mortgage insurance canceled. … Together, these HomeReady benefits often result in lower mortgage insurance costs compared to FHA.