What Is a HomeOne® Mortgage?
The HomeOne® Mortgage is a 3% downpayment mortgage backed by Freddie Mac. It's a low-downpayment conventional loan for first-time home buyers with decent credit.
HomeOne® allows buyers to finance up to 97% loan-to-value (LTV) with no income or geographical restrictions.
Key Facts at a Glance
| Requirement | HomeOne® Program Details |
|---|---|
| Minimum Credit Score | 620 |
| Minimum Down Payment | 3% |
| Income Limits | None |
| First-Time Buyer | At least one borrower |
| Occupancy | Primary residences only |
| Mortgage Insurance | Required with less than 20% down, cancellable at 20% equity |
Key Definitions
- First-Time Home Buyer
- A person who has not owned any residential property in the last 36 months. At least one borrower on a HomeOne® mortgage application must meet this definition.
- Loan-to-Value (LTV)
- The percentage of your home's value that you're borrowing. HomeOne® allows up to 97% LTV with 3% down.
- Private Mortgage Insurance (PMI)
- An insurance policy paid by the homeowner to protect the lender from loss. PMI is required until 20% equity is achieved. Then, it can be canceled.
- Debt-to-Income Ratio (DTI)
- The percentage of your income that goes toward debt payments. Freddie Mac sets maximum DTI rules for HomeOne® borrowers.
- Conforming Loan Limit
- The maximum loan amount allowed by Freddie Mac in your county. HomeOne® must stay within conforming limits.
Who Is the HomeOne® Program For?
The HomeOne® program is built for first-time buyers who have good credit but prefer to make a low down payment on their purchase.
HomeOne® is especially useful to first-time buyers who:
- Earn too much money to use the Home Possible® affordable mortgage program
- Want a no-frills 3% down option with standard conventional terms
- Will likely buy a home not within a low-income census tract
HomeOne® is Freddie Mac's version of Fannie Mae's Conventional 97 — a similar low-downpayment mortgage for first-time buyers.
HomeOne® Loan Benefits
HomeOne® gives first-time buyers pathways to buy with 3% down, unlike other conventional loans that ask for bigger down payments and require more rules.
| HomeOne® Feature | How It Helps You |
|---|---|
| Low 3% Down Payment | Smaller upfront cost for first-time buyers. |
| No Income Limits | Anyone may apply, no income cap. |
| No Geographic Restrictions | Available everywhere, no location rules. |
| Flexible Funding Sources | Use savings, gifts, or grants for your down payment. |
| Cancellable Mortgage Insurance | Drop PMI at 20% equity to lower payments. |
| Standard Conventional Terms | Simple, predictable loan terms. |
HomeOne® Loan Requirements
To get a HomeOne® mortgage, you and the home you want to purchase must meet Freddie Mac program guidelines.
Must Be A First-Time Home Buyer
At least one person on the HomeOne® mortgage application needs to be a first-time home buyer. This means that person has not owned a home in the past three years.
Must Have A 620 Credit Score or Higher
HomeOne® requires a minimum credit score of 620 . Lenders use this score to help decide if you qualify.
Must Make a 3% Downpayment Or More
You need to make a down payment of at least 3%. This money may come from your own savings, a gift from family, or down payment assistance.
Must Occupy The Property
The home must be your main residence. HomeOne® does not allow second homes or investment properties.
Must Finance With A Fixed-Rate Mortgage
HomeOne® is only available for fixed-rate mortgages. 30-year and 15-year terms are available. Adjustable-rate mortgages (ARMs) are not allowed.
Must Complete Approved Homeownership Education
If everyone listed on the mortgage application is a qualified first-time home buyer, everyone must also complete an approved homeownership education course prior to closing.
Comparing HomeOne®, FHA, and Home Possible®
When shopping for a low-down-payment loan, HomeOne® is often compared with FHA and Home Possible®. Here are the key differences:
| Feature | HomeOne® | Home Possible® | FHA Loan |
|---|---|---|---|
| Minimum Down Payment | 3% | 3% | 3.5% |
| Credit Score Minimum | 620 | 620 | 580 |
| Mortgage Insurance | Cancellable at 20% equity | Cancellable at 20% equity | MIP for life |
| Income Limits | None | 80% of Area Median Income | None |
| Geographic Limits | None | Some census tract exceptions | None |
| First-Time Buyer Only | Yes | No | No |
Solutions for Your Homeownership Journey
I'm not a first-time home buyer
HomeOne® is only for first-time buyers. If you don't qualify, consider these options:
| Alternative Program | First-Time Buyer Requirement | Credit Score | Down Payment |
|---|---|---|---|
| HomeReady | No | 620 | 3% |
| Home Possible | No | 620 | 3% |
| FHA Loan | No | 580 | 3.5% |
| Standard Conventional | No | 620 | 5%+ |
My credit score is below 620
If your credit score is below 620 , FHA loans may be your better low-downpayment option. See our HomeOne® vs FHA comparison for details.
I don't have money for a down payment
Pair HomeOne® with down payment assistance or use gift funds to cover the full 3% minimum. Learn more in our HomeOne® down payment and closing costs guide.
HomeOne®: Key Opportunities and Benefits
- Buy with just 3% down and no income restrictions.
- Cancel PMI once you've built 20% equity.
- Use gift funds or assistance for your entire down payment.
- Access conventional loan terms without geographic limits.
- Compare favorably against FHA and Home Possible® for many buyers.
Frequently Asked Questions
What is a HomeOne® mortgage?
A conventional loan from Freddie Mac that allows first-time buyers to purchase a home with as little as 3% down.
Who qualifies for HomeOne®?
At least one borrower must be a first-time home buyer with a minimum 620 credit score and the ability to make a 3% down payment.
Are there income limits for HomeOne®?
No. Unlike Home Possible®, HomeOne® has no income restrictions and no geographic limitations.
Can I use gift funds for the down payment?
Yes, the full 3% down payment can come from gifts or down payment assistance programs.
Is PMI required on HomeOne® loans?
Yes, PMI is required with less than 20% down, but it can be cancelled once you reach 20% equity.
