Written by Joe Costa and The Park Place Collective Group

February 7th, 2025

New Fannie Mae HomeReady® Income Limits & Grants Effective January 31, 2025

Joe Costa and Park Place Collective Group have an important 2025 update. For homebuyers looking to take advantage of Fannie Mae’s HomeReady® mortgage program, significant changes are coming in 2025. Starting January 31, 2025, HomeReady® will implement new income limits and grant amounts based on the subject property’s Area Median Income (AMI). These updates are designed to make homeownership more accessible to borrowers across different income brackets.

What’s Changing?

Under the new guidelines, borrowers will receive a grant based on their qualifying income relative to the AMI:

1. If qualifying income is ≤ 100% of AMI → Borrower receives a $4,500 grant
2. If qualifying income is > 100% and ≤ 140% of AMI → Borrower receives a $1,500 grant

These grants can help reduce upfront costs, making homeownership more affordable for low-to-moderate-income buyers.

Understanding Area Median Income (AMI)

The AMI is the midpoint of a region’s household income levels. Fannie Mae sets income limits based on this figure, and buyers can check their local AMI using Fannie Mae’s AMI lookup tool.

Who Benefits From These Changes?

1. First-time homebuyers who need assistance with closing costs.
2. Low-to-moderate-income borrowers looking for more affordable financing options.
3. Buyers in high-cost areas where home prices have made affordability a challenge.

Why This Matters

With rising home prices and interest rates, these grants offer a significant financial boost to eligible borrowers. The increased grant for those earning 100% or less of AMI can help cover down payments, closing costs, or other necessary expenses.

How to Qualify

1. Check your AMI using Fannie Mae’s online tool.
2. Ensure your income meets the grant thresholds (≤ 100% AMI for $4,500; 101-140% AMI for $1,500).
3. Work with a lender who offers the HomeReady® program and understands the new guidelines.

Final Thoughts

These new HomeReady® income limits and grants are a great opportunity for buyers who need financial assistance. If you’re considering buying a home in 2025, now is the time to start preparing. Contact Joe Costa and The Park Place Collective Team to learn more.

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