You can. The 3% down payment option is similar to existing conventional loan programs and can help meet the needs of first-time home buyers in the following ways:
According to the National Association of Realtors, the average home price is around $250,000. The 3% down conventional loan is a great way to expand home buyers’ purchasing power.
According to Fannie Mae’s Loan Level Price Adjustment (LLPA) graph, borrowers can have a score as low as 620 to qualify, some borrowers will receive the same or lower rate for a 3% down loan compared to those with 20% down.
But these loans will come with rates only about a one-eighth to one-quarter of one percent higher than rates available to borrowers putting 5-10% down and the time it takes to save an extra 2% for the down payment could mean higher home prices and tougher qualifying down the road.
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