Home Possible + Freddie Mac CHOICERenovation® · Primary Residence Rehab

Home Possible® Freddie Mac CHOICERenovation®

One conventional mortgage that pairs Home Possible's 3% down with Freddie Mac CHOICERenovation® rehab financing — purchase or no-cash-out refinance your primary home and roll renovations into a single note sized on after-improved value.

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3% down · 97% LTV

Primary residence only

LPA Accept only

Affordable rehab path

97% LTV · 3% down · $100k min

15-month completion · LPA Accept only · FHFA conforming max

Purpose

A conventional renovation loan combining Freddie Mac Home Possible® (low down payment affordable housing) with Freddie Mac CHOICERenovation®. Eligible low-to-moderate income borrowers purchase or refinance a primary residence and finance renovations into one mortgage while benefiting from Home Possible's 3% down payment options.

Loan Product Advisor must return Accept — manual underwriting is not permitted. Second homes and investment properties are not eligible under Home Possible.

At a Glance

Eligible transactionsPurchase · No-cash-out refi

OccupancyPrimary residence only

CreditLPA Accept only

Min loan amount$100,000

Max loan amountFHFA conforming limits

Max LTV97% purchase & refi (Home Possible)

Min repairsNone

Completion15 months after closing

Eligible Transactions & Occupancy

Eligible transactions

Purchase — Buy a fixer-upper and finance rehab in one closing.
No cash-out (rate/term) refinance — Refinance your existing mortgage and roll renovation costs into the new note.

Occupancy

Eligible only for primary residence occupancy. Home Possible is not available for second homes or investment properties — even when paired with Freddie Mac CHOICERenovation®.

Eligible Property Types

Home Possible and Freddie Mac CHOICERenovation® property eligibility rules apply.

1-unit primary residence

Manufactured homes (doublewide only)

PUDs (planned unit developments)

Eligible condominiums and certain other property types under Freddie Mac guidelines

Credit & Loan Size

Credit & underwriting

Loan Product Advisor (LPA) Accept required
Manual underwriting is not permitted

Loan amount limits

Minimum: $100,000
Maximum: Per FHFA conforming loan limits

Maximum LTV & Mortgage Insurance

LTV for eligible Home Possible borrowers

Purchase: Up to 97% LTV (3% down) for eligible 1-unit owner-occupied borrowers
No-cash-out refinance: Up to 97% LTV for eligible Home Possible borrowers

Mortgage insurance

Required when LTV exceeds 80%. Standard conventional mortgage insurance through Freddie Mac applies. Reduced mortgage insurance coverage is not permitted under the Freddie Mac CHOICERenovation® program — even when paired with Home Possible.

Repair Limits & Contingency

Purchase

Renovation costs cannot exceed 75% of the lesser of purchase price plus renovation costs, or as-completed appraised value. No minimum renovation amount.

Manufactured homes

Maximum renovation costs equal the lesser of $50,000 or 50% of the as-completed appraised value.

Contingency reserve

Required minimum 10%; 15% if utilities are off or not functioning. Maximum 20% contingency reserve. Unused contingency funds are applied to principal and may be reimbursed if originally funded by the borrower.

What Can Be Financed?

•Labor and materials
•Architectural/engineering fees
•Third-party construction management
•Five draw inspections and final inspection (1004D)
•Permit fees and title updates
•Contingency reserve (10% min · 15% if utilities off · 20% max)

•Up to 6 months of PITI when the home is uninhabitable
•Draw administration fee (greater of 1.5% of repair costs or $500)
•Unused contingency applied to principal (cash-paid contingency may be reimbursed)

Eligible Repairs

✔Structural and non-structural repairs
✔Kitchens, bathrooms, and room additions
✔Foundation work, roofing, and energy-efficiency improvements
✔Accessibility improvements
✔Swimming pools (allowed)
✔Appliances, mold remediation, and lead paint remediation

Consultant, Contractors & Draws

Consultant required only in Alaska, California, Hawaii, and New York. Otherwise, not required by the matrix.

One general contractor manages the project; specialty contractors permitted as needed.

Draw schedule

• Five draws plus final inspection (1004D)
• 10% holdback per draw
• Up to 50% of material costs advanced before construction begins
• 15-month draw period after closing

Eligible Loan Products

15-year fixed

20-year fixed

25-year fixed

30-year fixed

5/6 SOFR ARM

7/6 SOFR ARM

10/6 SOFR ARM

Additional Home Possible Benefits

When paired with Freddie Mac CHOICERenovation®, eligible Home Possible borrowers may receive:

3% minimum down payment

Keep more cash for moving and reserves after closing.

Flexible income sources

Co-borrower options in eligible situations help more households qualify.

Homebuyer education

Required for at least one borrower when all borrowers are first-time homebuyers.

AMI income limits

Household income generally capped based on area median income — with exceptions for designated underserved areas.

Conventional rehab path

Renovation financing without FHA mortgage insurance for the life of the loan.

Primary fixer-upper focus

Ideal for income-eligible buyers who want to customize a home they will live in.

Best Uses

Low-to-moderate income buyers who qualify for Home Possible AMI limits

First-time fixer-upper purchases with as little as 3% down

Cosmetic updates through major structural renovations on a primary home

Doublewide manufactured-home rehab when Freddie Mac property rules are met

No-cash-out (rate/term) refinance plus renovation while staying under Home Possible income caps

Borrowers who want conventional rehab financing with Freddie Mac affordable housing benefits

Home Possible Freddie Mac CHOICERenovation® only

Home Possible Freddie Mac CHOICERenovation® Calculator

Locked to primary-residence Home Possible rules — 97% LTV, 3% down alerts, $100,000 minimum loan, 75%/50% repair caps, contingency, draw admin, consultant toggle, and financed PITI reserve.

Program locked on this page

• Primary residence · Home Possible on
• 97% LTV max · 3% down minimum
• $100,000 minimum loan amount
• 5 draws + final 1004D · 10% holdback
• 15-month completion window
• Consultant only in AK, CA, HI, NY

Loan Purpose

Occupancy: Primary residence only · Home Possible: On (97% LTV / 3% down)

Doublewide manufactured home (lesser of $50k or 50% ARV cap)

Mortgage Product

Purchase Price

Repair Costs (no minimum · max $258,750)

Utilities off or not functioning (15% contingency vs. 10%)Property in AK, CA, HI, or NY (consultant required)

Permit Fees

Finance PITI reserve (up to 6 months if uninhabitable)

Down Payment (3% min for Home Possible)

$8,400 down

After-Improved Value (ARV)

Interest Rate

Property Tax (yr)

Home Insurance (yr)

HOA Dues (mo)

Estimated Monthly Payment

$2,911

Rehab escrow breakdown

Repair costs$65,000

Contingency (10%)$6,500

Draw admin fee$975

5 draw inspections$1,000

Permit fees$2,200

Total rehab escrow$75,675

Principal & Interest$2,252

PMI (standard est.)$275

Property tax$267

Home insurance$117

Total loan amount$347,275

LTV vs. ARV96.5% (max 97%)

Max loan at 97% LTV$349,200

Max repair cap$258,750

Down payment$8,400

Get Pre-Approved

This calculator is for informational purposes only. Results are estimates and are not exact — they do not include all closing costs, prepaid interest, or escrow deposits. Contact us for a personalized quote.

Home Possible and Freddie Mac CHOICERenovation® are registered trademarks of Freddie Mac. All loans are subject to credit and property approval. Program guidelines, income limits, LTV limits, and pricing are subject to change without notice and may not be available in all areas. This website is not affiliated with or endorsed by Freddie Mac, Fannie Mae, HUD, or any government agency. Information is for educational purposes only and is not a commitment to lend.

Mortgage Knowledge Center

Common Home Possible® Freddie Mac CHOICERenovation® Questions

Deep-dive guides on eligibility, 3% down, income limits, credit, improvements, contractors, fund draws, HomeReady HomeStyle comparison, and more — all for primary-residence buyers pairing Home Possible with Freddie Mac CHOICERenovation®.

Ready to buy and renovate with 3% down?

Ryan and Steve will confirm your Home Possible AMI eligibility, size the rehab escrow, and compare this path with standard Freddie Mac CHOICERenovation®, HomeReady HomeStyle, and FHA 203(k) before you write an offer.

Get Pre-Approved

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