Standard primary HomeStyle purchases require a 5% minimum down payment (95% LTV). Eligible HomeReady borrowers can put as little as 3% down — second homes and investment properties need more equity against after-improved value.
Minimums are educational — credit, LTV, property type, and lender overlays can raise cash required.
Up to 97% / 95% LTV
97% HomeReady or 95% standard on purchase; 97% HomeReady or 95% on refi. PMI applies under 20% equity and follows conventional cancellation rules.
90% LTV
90% LTV on purchase and refi — expect 10% down and stronger reserve requirements.
85% / 75% LTV
85% LTV on purchase, 75% on refi. Plan equity carefully if the rehab budget is large relative to value.
Renovation funds typically go into escrow at closing — you are not wiring the full rehab budget as a separate check to the contractor on day one. Your bring-to-close cash is mainly equity, closing costs, and any reserves required after closing.
On primary HomeStyle loans under 20% equity, conventional PMI applies. Unlike FHA MIP, PMI can often be canceled once you reach the required equity milestones through paydown or appreciation after renovations complete.
| Factor | HomeStyle | FHA 203(k) |
|---|---|---|
| Primary purchase LTV | 97% HomeReady / 95% standard | 96.5% (3.5% down) |
| Second home LTV | 90% purchase & refi | Generally primary only |
| Investment LTV | 85% purchase / 75% refi | Generally primary only |
| Gift funds | Conventional gift rules | FHA gift rules (often more flexible) |
Related guides on borrowing power, gifts, and purchase-plus-rehab structure.
How LTV and after-improved value set your loan size.
Score tiers that affect pricing and overlays.
How purchase and rehab combine at one closing.
Baseline conventional cash-to-close options.
How conventional gift money must be documented.
Full program overview and comparison.
Your equity requirement applies to the total HomeStyle loan structure — acquisition plus eligible renovations — against after-improved value. Plan cash for the combined amount, not just the listing price.
Yes, when conventional gift rules are met — typically from an eligible donor with a gift letter and documented transfer. Gift rules tighten on investment properties.
Often yes. Closing costs, prepaid items, and post-closing reserves (especially on second homes and investments) sit outside the down payment. Renovation contingency is usually inside the loan escrow, not extra cash you bring — unless the appraisal or LTV forces it.
Standard primary HomeStyle requires 5% down (95% LTV). Eligible HomeReady borrowers can go as low as 3%, vs. 3.5% on FHA — but credit, PMI cost, income limits, and occupancy decide which is cheaper overall. Second homes and investments need more with HomeStyle; FHA is generally primary only.
Ryan & Steve will size down payment, closing costs, and reserves for your occupancy and rehab budget before you offer.
HomeStyle is a registered trademark of Fannie Mae. All loans are subject to credit and property approval. Program guidelines, 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 Fannie Mae, HUD, or any government agency. Information is for educational purposes only and is not a commitment to lend.