Lower down payment requirements.

Fannie Mae unveiled a new policy that will significantly reduce down payment requirements for owner-occupied 2-, 3-, and 4-unit homes. Set to be effective from the weekend following Nov. 18, 2023, the down payment will now be 5%, a stark decrease from the previous 15-25% requisite for duplexes, triplexes, and four-plexes. This policy shift presents an exciting opportunity for individuals aspiring to invest in multifamily residences, blending the advantages of property investment with homeownership perks. By diminishing the down payment barrier, Fannie Mae has paved the way for prospective owner-landlords to afford these properties more seamlessly. Fannie Mae declined to comment further on why it made the decision, but it’s a decision being praised by some in the industry. Thrive Mortgage’s Chief Operations Officer Donielle Geiser said they are thrilled about the announcement. “Lowering the down payment threshold on 2–4-unit properties is such a critical enhancement to the guidelines for a host of reasons. Predominantly, it immediately becomes a golden opportunity for increased affordability due to the potential income generating possibilities,” Geiser said. “Especially for younger and prospective homeowners looking to engage in a smart way of not only building equity, but also adding an additional revenue stream. One of the surest ways to build wealth over time is to offset a liability with an income-producing asset.” 

Source: National Mortgage Professional