What is Conventional 97 (Fannie 97, Freddie 97) Mortgage?

Both government-sponsored enterprises, Fannie Mae and Freddie Mac offer a conventional mortgage for first-time homebuyers with as little as 3% down as a more affordable way to enter the housing market while allowing borrowers to keep more money in their pockets for other expenses. 

These mortgages are eligible to purchase a 1-unit primary residence, utilizing a fixed rate with a maximum term of 30 years.  Mortgage insurance is required.

Only one borrower must be a first-time homebuyer, but all borrowers must occupy the property as their primary residence.  If all borrowers are first-time homebuyers, an online homebuyer education course must be completed prior to closing.

There is no maximum income limit, but there is a reduction in interest rate or cost if the qualifying income is below 100% of the Area Median Income.

The Conventional 97 program, also known as 97% Conventional, Fannie 97, and/or Freddie 97, usually has a higher mortgage insurance premium than Fannie Mae's HomeReady and Freddie Mac's Home Possible® products,