HomeReady Mortgage Program

HomeReady® is a special community lending program designed to make homeownership accessible to more people. It provides easier qualification guidelines, low down payment, and favorable pricing. It was created for borrowers with low-to-moderate income.

With its favorable pricing, the program is preferable over the regular Conventional 3% (Fannie 97%) down program. If you're considering FHA or Conventional 5% down payment, you should also compare with HomeReady. Below you'll see an example comparison to some of these programs.

HomeReady helps people who...

  • Have low to moderate income OR are purchasing in certain areas

  • Are repeat OR first-time homebuyers

  • Have limited cash for down payment

  • Have a credit score of 620 or higher

Where HomeReady works

Home Ready Benefits​

  • Low down payment: As low as 3% down payment (97% LTV) (For single family homes and condos)

  • Borrower is not required to be a first-time buyer

  • Pricing that is better than or equal to standard loan pricing 

  • Borrowers with credit scores of 680 or higher get better pricing (620 minimum score)

  • Discounted PMI (private mortgage insurance) for low down payments

  • Cancellable PMI  (restrictions apply)

  • Flexible sources of down payments. See below.

  • Down payments can come from "cash on hand"

  • Down payments can come from gifts or grants

  • Flexible qualification standards responsibly expand access to credit.

  • Non-occupant borrowers can co-sign (for added income)

  • Flexible sources of funds can be used for the down payment and closing costs

  • No minimum contribution required from the borrower’s own funds (on 1-unit properties).

  • Homeownership education. The program includes an online course to prepare borrowers for sustainable homeownership.

HomeReady Eligible Property Types
  • One- and two-unit properties: Fixed-rate or ARM loans.

  • Three- and four-unit properties: fixed-rate loans only. 

Minimum Down Payment for Purchase Transactions with HomeReady


  • One-unit (single family or condo): 3%

  • Two-unit (duplex): 15%

  • Three- or four-unit (multi-family): 25%

Pre-Approval for HomeReady

If you'd like a pre-approval, you do not need to choose a program first. We'd be happy to help you explore. If you're interested in pre-approval, complete the information at Get Started Online.

Special HomeReady Qualification Loopholes

I'm using the word "loopholes" just for fun because these are purposely designed to make the program uniquely accessible.  Here are some of the "loopholes" --


  • The income limits only count people on the loan (not everyone in the home).

    This is special. Most special programs that have income caps count the total income from all household members to determine if they exceed income caps, regardless if their income is counted for loan qualification.

  • However, income from a non-borrower residing in the home can be a "compensating factor" for qualification. More on this below.

  • Downpayment can come from "cash on hand"

  • Cosigner - Someone not living in the property can co-sign for the mortgage

  • Income from roommate, boarder, or rental counted in some situations. For example, the rental income can come from a basement apartment, without reference to local zoning requirements.

Let's Work Together!

Let's make this easier for you! When you work with us on HomeReady or any other loan program, you'll get three distinct advantages --

1. We'll help you explore your options. Many lenders don't offer and overlook options such as HomeReady. As you can see from the program guide, we're very straightforward about the pros and cons of each program. Ultimately, we need to learn about your personal situation so we can explore the options relevant to you. We'll make it easy to compare the options side by side.

2. We'll give you an advantage for getting your offer accepted. Many Realtors refer clients to us because we're known in the local real estate community for being fast and reliable. It makes a difference when the seller's agent sees we're providing your financing.

On top of that, we invite you to participate in our VIP FasTrak program which can give the seller even more confidence in you as a buyer. It can also help you close faster than 95% of other buyers who are applying for a mortgage. All of this is even more important when the seller see you're using a small down payment program.

3. You'll be our priority. Unlike banks, we only do mortgages. Our business comes from referrals. Our reputation lives or dies based on the experience of each customer. We'll closely walk you through the process from beginning to end.

Your first step is to complete the information at our Get Started Online page.

HomeReady Maximum Income Limits (Income Caps)

The Home Ready program provides two sets of maximum income standards:

  • In areas designated as low-income communities, there are no maximum income caps. A borrower will not be disqualified due to high income.

  • In all other areas, the income limit is 100% of the Area Median Income

  • For determining eligibility under income limits, we only count the income from the borrower(s) listed on the mortgage to the extent we're counting his or her income for qualification.

    This provides a potential loophole. For example, we could potentially count the income from just one spouse if it's sufficient for loan qualification.

  • To get the income limit for your area, you can use the Income Eligibility Lookup tool

Income Qualification on HomeReady

Income qualification is different than "income caps". Income qualification means earning enough income to qualify for the loan. This is part of the qualification for all kinds of mortgages. 

The HomeReady program provides three ways to supplement your income calculation for the purpose of qualification --

  • Non-occupant borrower (cosigner). This refers to someone, such as a parent, not living in the property, who's willing to cosign for the loan. This allows us to count their income.

  • Non-borrower household income. This refers to someone who's living in the home but not included as a borrower on the mortgage. Since this person's income is not counted as part of the "maximum income limits", it's also not counted in the income qualification calculation. However, it can be considered for qualification in a limited way:

    It can help as a "compensating factor" to obtain an exception for a higher debt-to-income ratio. Normally debt-to-income ratio is limited to 45%. By documenting the income for a non-borrower who's staying in home, the maximum deb-to-income ratio can be raised to 50%.

  • Roommate or rental income. In some situations, we can count income from a roommate or renter.

As you can see, this program allows us to "bend over backwards" to help you qualify.


Don't worry if this information sounds confusing! We'll explain your relevant options when you get in touch through Get Started Online.

HomeReady homeownership education requirement 


The program is about empowering people through homeownership. That’s why HomeReady involves a homeownership education requirement. It's designed to help borrowers gain important knowledge to prepare for sustainable homeownership.

The education can be completed through a special online program. The program is specifically offered for HomeReady borrowers. We can connect you with it. It can also be completed through a HUD-approved counseling agency within a certain period of time in respect to the application.

Ownership of Other Property on HomeReady

Borrowers who occupy the property may not have an ownership interest in any other residential property at the time of loan closing. This restriction does not apply to a cosigner who doesn't live in the property. ​

HomeReady Compared to FHA

With HomeReady, borrowers may have the option to cancel their mortgage insurance once their home equity reaches 20%. (This involves certain rules, procedures, and requires an appraisal). This can result in lower monthly payments in the future.

This is a big advantage HomeReady over FHA because the mortgage insurance on FHA is permanent.


The chart below roughly illustrates cost differences between three major low down payment programs. (Note, the rates in the table are hypothetical for illustrative purposes, not actual rates advertised or offered).

Notes on this table: 
*Property taxes, homeowner's insurance, association fees would be added
** This example assumes credit score over 720. The PMI figures and rates could be different relative to the other programs depending on credit score.

***Assuming 3% annual home appreciation, the loan would reach an LTV ratio below 80% after approximately 61 months. 

This table is just a generic example. Why not get in touch with us? Then we can provide personalized information and options for you. If you're searching for a home within the next three months, your first step is to complete the information at Get Started Online.

Frequently Asked Questions about HomeReady Mortgages

Q. What does AMI (Area Median Income) Mean?

A. HomeReady is generally limited to borrowers making up to 100% of the AMI. This is a measurement of the average income for an area. You can look up the AMI for your local area with this AMI Lookup Tool. While some other programs limit to 80% of AMI, this program is more flexible and allows 100% of the AMI

There is an exception: The maximum income cap is removed in designated areas. You can identify these with the same lookup tool.

Q. My spouse and I individually earn under 100% of the AMI. But together we earn more than the AMI. Can we get a HomeReady Loan?

A. Possibly! That's one of the "loopholes" we discussed. If one of you individually earns enough to qualify for the loan, it's possible to count only your income and ignore the other income.

Q. Is Fannie Mae HomeReady an FHA Loan?

A. No. Fannie Mae and FHA are two different agencies. You can see an example comparison between HomeReady and FHA in the illustration above. We provide both types of financing and would be happy to help you compare in a more personalized way!

Q. What's the difference between HomeReady and HomePossible?

A. We offer both programs. The basic difference is simply each of the two major mortgage agencies backs its own program. Fannie Mae backs HomeReady. We don't discuss HomePossible separately here, only because it overlaps so much with HomeReady. 

Q. What if I do not have enough credit history established?

A. In some cases, we can build an alternative credit history by documenting your payment history on items such as rent, utilities, cable, cell phone, or other bills you pay monthly.

Q. Can I use HomeReady in all areas in Wisconsin?

A. Yes, HomeReady works in all areas of Wisconsin and the United States.

Q. Is the education requirement easy to complete?

A. Yes, HomeReady offers a specific online education class that's informative and easy to complete. 

Q. What's the rate for HomeReady?

A. There are multiple options. There isn't a single rate, but there are several options available on a scale of rate and costs. Use our Get Started Online page to provide some information so that we can provide accurate options to you.

How Can I Get More Information about HomeReady and other options?

You're not alone! We'd be happy to help you explore and compare options. Here's your next step...

  • If you're targeting a home purchase within the next three months, you should already be in touch with us! Use the Get Started Online page to complete your first step. This will help us learn about you, and help identify which options could be useful to you.

  • If you're beyond three months away from purchasing a home, use the contact form below. We'll get in touch at our convenience with a phone call at no cost. This will give you some guidance to help you plan and prepare! 

I'm beyond three months away, but please call to help me plan and prepare by home purchase!

I'm outside WI, but your info and programs are marvelous! Please put me in touch with a colleague who serves my area!

Greg Schliesmann
Branch Manager, NMLS# 234288
Cherry Creek Mortgage Co., Inc

Greg Schliesmann
Branch Manager, NMLS# 234288
Cherry Creek Mortgage Co., Inc

1033 N Mayfair Rd, Suite 100
Wauwatosa, WI 53226

Tel: 414-617-1756

1033 N Mayfair Rd, Suite 100
Wauwatosa, WI 53226

Tel: 414-617-1756

Free Access to Greg's Valuable Video Series

Five Strategies to Stand Out from Homebuyer Competition and Get Your Offer Accepted!

Free Access to Greg's Valuable Video Series

Five Strategies to Stand Out from Homebuyer Competition and Get Your Offer Accepted!

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Copyright ©2018 Cherry Creek Mortgage Company & Greg Schliesmann for CCMC, Inc.

Cherry Creek Mortgage Co., Inc. NMLS #3001. All Rights Reserved. Some loan products may not be available in all states. Terms, rates, and fees subject to change. Please speak with one of our loan originators for more detail.