WASHINGTON – April 30, 2018 – Freddie Mac is debuting a new 3 percent downpayment option for qualified first-time buyers that could put it in direct competition with the Federal Housing Administration's (FHA) low-downpayment mortgage. The mortgage financing giant announced last Thursday that it's rolling out a new conventional 3 percent downpayment option called HomeOne, which will not have any geographic or income restrictions.
Freddie's expansion into small downpayment loan products for new buyers will put it in competition against FHA, which offers mortgages to first-time buyers that similarly only require 3 percent down.
Freddie Mac rolled out conventional mortgages with 3 percent downpayments more than three years ago for qualified low- and moderate-income borrowers. But it says its HomeOne product won't replace its current Home Possible products; instead, it's designed as a complement to it, Freddie Mac officials say.