Is Freddie Mac trying to revive the ‘American Dream’ of home ownership? They have just announced the launch of a conventional mortgage requiring a 3% down payment.
They attempted to launch a similar loan 3 years ago with income restrictions, these restrictions excluded most people whom were in the home buying market. Needless to say this previous program hardly got off the ground. The economy was beginning to slow down in 2015 and the modest income requirement left many first time buyers on the sidelines although they could save up the reduced down payment.
This new program is a remake of the last program but it excludes the geographic restrictions along with the income restrictions. By eliminating the income requirements will allow many people to participate. Those who qualify and participate in these loans will be backed by a government loan guarantee, in other words if they default the government (otherwise known as the taxpayer) will be on the hook for the loan.