HFA Preferred
Fannie Mae is focused on providing more homebuying solutions that will help low- to moderate-income borrowers achieve homeownership. With our HFA Preferred™ product, lenders can grow their businesses as we work together to bridge the affordable housing gap.
Certainty you can count on with HFA Preferred
Fannie Mae works with nearly 70 state and local housing finance agencies (HFAs) to support affordable homeownership. HFAs bring a high-touch, mission-motivated approach to consumers from application through the life of the loan.
HFA Preferred is Fannie Mae’s low down payment conventional mortgage product that participating HFAs can use to serve low- to moderate-income borrowers exclusively through their lender partners. This is an ideal product for lenders and their borrowers looking to work through their state or local HFAs.
To originate HFA Preferred, lenders should contact their state or local HFA about becoming an approved HFA correspondent lender. The National Council of State Housing Agencies and the National Association of Local Housing Finance Agencies provide resources to help lenders learn more about working with HFAs.
More benefits mean more access
- Down payment assistance available through many HFAs
- Lender-funded grants permitted under certain circumstances
- Borrower income limits set by the HFA
- Reduced mortgage insurance coverage for loans at or below 80% of Area Median Income (AMI)
- No minimum contribution requirement from borrower’s own funds (one-unit properties)
How HFAs bring value to lenders
How HFA Preferred helps borrowers
Why choose HFA Preferred?
| Benefits | HFA Preferred Mortgage | FHA |
|---|---|---|
| Down payment as low as 3% | Yes | No |
| Cancellable mortgage insurance* | Yes | No |
| Lender can order the appraisal immediately | Yes | No |
| No geographic restrictions on loan amounts | Yes | No |
| Day 1 Certainty® freedom from certain representations and warranties | Yes | No |
*Restrictions Apply
For a detailed comparison click here.
Homeownership education
To qualify for purchase loans with an LTV greater than 95%, homeownership education will be required for at least one borrower when all occupying borrowers are first-time homebuyers.
Learn more about homeownership education.
Housing counseling
For HFA Preferred purchase transactions when buyers have received housing counseling from a HUD-certified housing counselor within the 12 months prior to the loan closing date, lenders may be eligible to receive the $500 loan-level price adjustment credit if they complete the Housing Counseling data fields in DU or on the Supplemental Consumer Information Form (Form 1103) for manually underwritten loans and deliver the loan with SFC 184.
Learn more about housing counseling.
Manufactured housing
The lack of affordable housing supply makes manufactured homes a great solution. An HFA Preferred mortgage can be used to purchase a manufactured home helping your prospective homebuyers get the home they want at a price they can afford. Click here to learn more.
