What Are the HomeReady Loan's Income Limits?

The Fannie Mae HomeReady mortgage helps low- and moderate-income borrowers buy a home with as little as 3% down, often with lower interest rates and reduced mortgage insurance compared to standard conventional loans. To qualify, your total household income used to qualify for the loan can’t exceed 80% of the Area Median Income (AMI) for the property’s location.

These limits vary by county and are updated each year by Fannie Mae. You can quickly check your eligibility using the Fannie Mae Income Eligibility Lookup Tool.

Because the program caps income but offers flexible underwriting, HomeReady is designed for borrowers who earn a steady paycheck but need help qualifying — including first-time buyers, single-income households, or families using gift funds or down payment assistance to buy a home.

Fannie Mae HomeReady mortgage at a glance

Your total qualifying income must be ≤ 80% of the Area Median Income (AMI) for the property’s location — no exceptions by census tract. Lenders determine this using Fannie Mae’s AMI Lookup Tool or Desktop Underwriter (DU). AMIs update annually, so always check the current figure for your address.

Program highlights include:

• 3% down on a 1-unit home; no first-time buyer requirement.

• No minimum borrower funds for 1-unit purchases—gifts, grants, and Community Seconds® can cover down payment and closing costs (stackable up to 105% CLTV).

• Reduced MI and waived LLPAs vs standard conventional, which can lower total cost.

• Eligibility: ≤ 80% AMI for the property’s location (verified in DU/AMI tool).

• Credit: 620+ typical; non-traditional credit allowed; positive rent history can help DU approve thin/no-score borrowers.

• Income flexibilities: potential use of boarder income (capped/ documented) and accessory-unit rent on a 1-unit principal residence.

Prospective home buyers are permitted to obtain the required 3% down payment and other closing costs as a cash gift or grant from an eligible donor (e.g., a parent, relative, spouse, partner, etc.). The money does not need to be yours.

Public employees (firefighters, police officers, health care professionals, teachers, and so on) and military personnel may be eligible for specific flexibilities, such as the utilization of overtime and part-time income.

How to check your limit

1. Open Fannie Mae’s Income Eligibility (AMI) Lookup and enter the property address.

2. Confirm the HomeReady Income Limit value shown and compare it to your total qualifying income on the application. If you’re over the limit, HomeReady won’t apply (but your lender can show you similar options). 

Credit score and debt-to-income ratio

To qualify, borrowers must typically have a credit score of 620+. Borrowers with non-traditional credit could still be eligible through DU or manual underwriting.

Income from a non-borrower household member may be considered for a debt-to-income (DTI) ratio up to 50 percent. HomeReady allows non-occupant borrowers, such as a parent. Debt to income is a simple calculation that evaluates the amount of income and monthly bills.

Because HomeReady is designed especially for low-to-moderate income families, the loan program waives many of the loan costs that are often associated with “standard” conventional home loans.

Private mortgage insurance (PMI) is required for down payments less than 20%; however, the monthly cost is reduced.

The program is offered as an adjustable-rate mortgage (ARM) or a fixed-rate mortgage (FRM), with maturities ranging from 30 to 20 years, 15 to 15 years, and 10 years.

Multi-unit houses are allowed if the borrower plans to live in one of the home's units (i.e. main residence). HomeReady cannot be utilized to purchase an investment property.

Loan application is made through approved Fannie Mae lenders. Most banks and mortgage brokers offer the HomeReady loan program.

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