One percent down on a new home loan? Zero down? Generous gifts of thousands of dollars from mortgage companies to help you swing the deal? If any of these sounds attractive to you, here’s a little sobering news: One of the country’s two largest mortgage sources is eliminating them. In a surprise move, giant investor Freddie Mac announced that it is ending purchases of certain low-down-payment loans that include lender contributions to the buyers’ down payments. Under these programs, a lender might reduce the required minimum down payment on a Freddie Mac “Home Possible Advantage” loan from 3 percent to just 1 percent. The two percentage-point difference would be provided by the lender as a gift.
Source: The Washington Post