In a groundbreaking move, Fannie Mae has recently announced some significant changes to their loan-to-value (LTV) ratios for primary 2-4 unit properties. Effective immediately, as of November 20th, 22023, MortgageDepot customers can now benefit from a higher LTV of 95% on conforming loan amounts. We will delve into the details of these new guidelines and shed light on the opportunities they present for potential homebuyers.

Conforming Loan Amounts:

Under the revised guidelines, Fannie Mae now allows a maximum LTV of 95% for conforming loan amounts on 2-4 unit properties. This means that borrowers can secure loans up to the following amounts:

– 2 unit: $929,850

– 3 unit: $1,123,900

– 4 unit: $1,396,800

High Balance Loan Amounts:

While the LTV for conforming loan amounts has been increased, it’s important to note that high balance loan amounts have seen a reduction in LTV. The new guidelines stipulate that high-balance loan amounts are now limited to an 85% LTV.

Debt-to-Income Ratio (DTI):

To ensure responsible lending practices, Fannie Mae has set a maximum DTI of 50%. This means that borrowers’ total monthly debt payments, including the mortgage, should not exceed 50% of their gross monthly income.

Rental Income Qualification:

One of the noteworthy changes in the guidelines is the requirement for borrowers to verify a current primary housing history when using rental income to qualify. This verification can be done through rent checks or other suitable documentation.

Non-Occupant Co-Borrower Transactions:

For non-occupant co-borrower transactions, Fannie Mae now mandates that the entire down payment must come from the borrower. This ensures that the borrower has a vested interest in the property and promotes responsible homeownership.

First-Time Homebuyer Requirement:

Under the new guidelines, at least one borrower must be a first-time homebuyer. This provision aims to support individuals who are entering the housing market for the first time, providing them with additional opportunities to secure financing.


To account for potential financial challenges, Fannie Mae now requires borrowers of 2-4 unit properties with a DTI over 45% to have six months of principal, interest, taxes, and insurance (PITI) reserves. This ensures that borrowers have sufficient funds to cover their mortgage payments in case of unforeseen circumstances.

Fannie Mae’s updated guidelines have opened up exciting possibilities for homebuyers seeking financing for primary 2-4 unit properties. With a higher LTV of 95% on conforming loan amounts, reduced LTV for high-balance loan amounts, and various other provisions, these changes aim to make homeownership more accessible and sustainable. If you’re considering purchasing a multi-unit property, now is an excellent time to explore your options with MortgageDepot and take advantage of these favorable guidelines.

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