If historically low-interest rates and a generally positive lending atmosphere haven't been enough to get you off of the fence, maybe it's because you're renting and are concerned you won’t qualify for a mortgage, thanks to a low credit score (a FICO score lower than 700) or lack of cash for a downpayment. If this is you, then you definitely need to take a closer look at a pair of programs: Fannie Mae's HomeReady Program and Freddie Mac's Home Possible Advantage Program, both available through most lenders.

Fannie Mae’s HomeReady program (very similar to Freddie Mac’s Home Possible Advantage program) has recently been revamped and is designed to help a borrower in need of downpayment assistance. The minimum requirement is just 3%, but no cash is required if you can get a gift from a family member or rental income from an in-house boarder. Another benefit: if you have other family members living in the home with you, their documented income can count towards your debt-to-income ratio (DTI). Another benefit is the ability to cancel private mortgage insurance (PMI) – a major advantage compared to the non-cancellable PMI you’ll find with an FHA (Federal Housing Administration) loan. PMI can cost hundreds of dollars each month, so the ability to cancel at some point can save thousands.

It is important to note that both programs are primarily aimed at low-to-moderate income buyers – those who can’t quite qualify for traditional financing.  Additional borrower profile characteristics may come into play. First-time buyers, those living with an extended family, minority buyers, or “underserved” communities, are of particular concern to Fannie and Freddie’s policymakers.

Bottom Line: Don’t think that just because you’ve got a blemish on your credit (or just not enough credit, if you’re just starting) or your bank account isn’t overflowing, you don’t have an opportunity to become a homeowner. Check with your lender and ask about Fannie and Freddie’s HomeReady and Home Possible Advantage programs.