For those looking to purchase a home, understanding the different loan options available is important. Two popular options are HomeReady and HomePossible. While they may seem similar on the surface, there are some key differences between the two loans. Here are some important distinctions to keep in mind when considering these loans:
Minimum Credit Score: HomePossible’s Home Possible loan sets a higher minimum credit score guidelines (660) over that of the HomeReady credit line. This means that those with lower credit scores may be better suited for a HomeReady loan.
No Credit Score Option: HomePossible offers a loan option for those who do not have a credit score due to a lack of credit background. This is a unique feature not offered by HomeReady. However, the no-credit-score option is accompanied by a minimum of 5 percent down amount.
Income Limits: Both HomeReady and HomePossible loans have income limits that borrowers must meet in order to qualify. However, these limits vary depending on the geographical location of the property. Potential borrowers should research the specific limits in their area.
Overall, both HomeReady and HomePossible loans offer unique benefits and drawbacks. It is important to weigh the differences between the two and determine which loan may be the best fit for your individual financial situation.
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