Freddie Mac has announced an exciting expansion in its Home Possible sweat equity parameter in regards to closing costs and down payments. Homebuyers have always had the option of utilizing sweat equity as a source of funds, but were also required to contribute five percent from other personal funds. The expansion allows borrowers the opportunity to utilize their construction skills for up to the entire amount of down payment and closing costs.
Appalachia has always been historically financially underserved. The region also contains a large density of aging housing stock. Freddie Mac’s change in the application of sweat equity will create homeownership opportunities in Fahe’s service area where low-to moderate- income families sometimes face difficulties in acquiring money for down payment costs. It also provides opportunity and incentive for the purchase of older homes in need of renovations.
Fahe is excited to be collaborating with Freddie Mac in this endeavor alongside other great organizations across the country including Hope Enterprise Corporation, Homeownership Education Resources Organization (HERO), Enterprise Community Partners, Community Development Corporation of Brownsville (CDCB), Next Steps and NextJob.
Through these partnerships, Freddie Mac provides borrowers the education, resources, and training necessary to understand its parameters. Additionally, Freddie Mac is providing technical assistance and training to help increase the organizations’ capacity to offer homebuyer education, housing counseling, employment and re-employment services, and related resources to families in Middle Appalachia, the Lower Mississippi Delta, the Colonias, and Native Americans in Indian reservation areas.
The offering is part of Freddie Mac’s Duty to Serve plan, which focuses on the nation’s most persistent housing challenges in three historically underserved markets: manufactured housing, rural housing and affordable housing preservation. You can learn more about the expansion on Freddie Mac’s website.