New 3% down mortgage (Non-FHA) option from Wells Fargo questions

[Kyle Myers]

@Matt Ashton

[Chris Mason]

Yeah I've done a few. It's not a Wells Fargo special thing, it's a Fannie Mae thing that any Fannie lender can do. Though good on Wells Fargo for getting cnbc to run a giant advertising spot for free.

The deal I closed for @Account Closed earlier this week was actually one of these; the home was two blocks away from a census tract line that would have killed the deal. Those buyers did not have 5% down and 3.5% FHA was out of the question.

• Owner occupied only.
• Income caps may apply depending on census tract, which makes a standard/vanilla preapproval a huge pain in the butt because realtors/buyers just want a number and nothing else.... you can't search the MLS by census tract.
• For the above reason, I don't generally talk about it until I have a ratified contract on my desk, and then it's a surprise "good news!" phone call that we can get them a better deal than FHA.
• For good credit scenarios, monthly mortgage insurance will generally be less than FHA.
• Here's Fannie's map: https://homeready-eligibility.fanniemae.com/homere...
• Fannie has less DTI flexibility than FHA, so this isn't going to happen for any buyer that walks into a lender's office and says "max me out!"