Here's something we hear from first-time buyers all the time: "We don't have 20% down, so I guess we're doing FHA." Not necessarily! After more than 20 years helping Long Island families buy their first homes, HomeOne® is one of the loans we wish more people knew about. It's Freddie Mac's conventional mortgage made just for first-time homebuyers: a low down payment, no income limits, a fixed rate, and mortgage insurance you can eventually cancel. Let's walk through how it works, who qualifies, and the one Long Island detail you'll want to plan around.
What Is Freddie Mac HomeOne?
HomeOne is a conventional mortgage program from Freddie Mac, one of the two government-sponsored companies that buy most U.S. home loans. It lets a qualified first-time homebuyer finance up to 97% of the home's value, which means a down payment as low as 3%. In Freddie Mac's own terms, HomeOne covers loans with a loan-to-value ratio above 95%, up to a 97% maximum.
What makes it different from the other low down payment options is what it doesn't have: no income cap, no geographic restriction, and no government mortgage insurance premium that sticks around for the life of the loan. For a lot of Long Island buyers with solid income and good credit but not a 20% down payment saved, it's the cleanest path into a first home. If you're comparing loan types in general, our conventional loans page covers the broader category HomeOne belongs to.
Key Benefits of HomeOne
Minimal Down Payment
Finance up to 97% of the purchase price (97% maximum LTV and TLTV), so the minimum down payment is 3%.
Up to 105% TLTV with an eligible Affordable SecondNo Income Caps
Unlike Home Possible and HomeReady, HomeOne has no borrower income limit. Earning well on Long Island doesn't disqualify you.
No Geographic Limits
No targeted-area or census-tract rules. An eligible home anywhere on Long Island, or anywhere in the U.S., qualifies.
Cancelable Mortgage Insurance
Borrower-paid private mortgage insurance can be removed. You can request cancellation once your balance reaches 80% of the home's original value, and it ends automatically at 78%.
Unlike FHA, where it usually lasts the life of the loanFlexible Down Payment Sources
Your down payment can come from savings, a documented gift from family, or eligible down payment assistance, including Affordable Seconds.
Refinance Option
HomeOne also works for no cash-out refinances up to 97% LTV. The first-time buyer rule applies to purchases only.
Above 95% LTV, the loan being refinanced must be Freddie Mac-ownedHomeOne Requirements
The benefits are generous, so the rules are specific. Here's the full checklist, straight from Freddie Mac's current fact sheet. Don't worry if a line or two is confusing, that's exactly what we're here for.
The One Thing Long Island Buyers Need to Plan Around: Loan Size
Nassau and Suffolk are high-cost counties, so most conventional loans here can go up to a higher local limit. HomeOne can't. Freddie Mac's rules say a HomeOne mortgage is not eligible as super conforming, so the maximum loan is the national baseline, not the Long Island limit.
In practice, that sets up a simple ladder based on purchase price:
The minimum 3% down keeps the loan at or under $832,750. This covers a big share of Long Island's starter-home market.
Put down whatever it takes to cap the loan at $832,750. You're still above 95% LTV, so it's still HomeOne.
Conventional financing with as little as 5% down still works up to Nassau/Suffolk's $1,209,750 limit. It's just no longer HomeOne.
So a buyer looking at a $1 million home isn't shut out of low down payment conventional financing. They'd simply use a standard 95% conventional loan instead of HomeOne. Curious what those price points actually buy? See what $600K, $800K, and $1M buys on Long Island right now.
Illustration of minimum down payments only, based on 2026 program guidelines. It does not include closing costs, prepaid items, or reserves, and it is not a loan offer. Your actual down payment, APR, and payment terms depend on credit approval, loan amount, and property. FHA loans are subject to FHA county loan limits.
HomeOne vs. FHA vs. Home Possible vs. HomeReady
All four can get a first-time buyer in with a small down payment. The differences show up in income rules, mortgage insurance, and loan size.
| HomeOne | FHA | Home Possible | HomeReady | |
|---|---|---|---|---|
| Backed by | Freddie Mac | HUD / FHA | Freddie Mac | Fannie Mae |
| Minimum down | 3% | 3.5% | 3% | 3% |
| Income limit | None | None | 80% of area median | 80% of area median |
| First-time buyer required | Yes (purchase) | No | No | No |
| Mortgage insurance | Private MI, cancelable | Upfront + annual MIP, often for the loan's life | Private MI, cancelable | Private MI, cancelable |
| Max loan on Long Island | $832,750 (baseline) | FHA county limit | County limit, lower max LTV above baseline | County limit, lower max LTV above baseline |
If your income is under 80% of the area median, HomeReady and Home Possible can come with reduced mortgage insurance costs and are worth pricing side by side. If your credit is still being built, an FHA loan can be more forgiving. For everyone else, HomeOne is often the simplest fit, since there's no income test to pass.
Pricing is where a broker earns its keep. Every lender sets its own pricing and overlays on HomeOne. Because Coltrain shops a range of wholesale lenders instead of offering one bank's version, we can compare the same HomeOne loan across several of them, and put it next to FHA and HomeReady so you can see which one actually costs you less.
Refinancing With HomeOne
HomeOne isn't only for buying. It also covers no cash-out refinances up to 97% LTV, and the first-time buyer requirement doesn't apply to refinances. The catch: when the new loan is above 95% LTV, the mortgage being refinanced generally must already be owned or securitized by Freddie Mac. That's something we can check for you from your current servicer information.
How to Get Started
New to the whole process? Our Long Island first-time homebuyer guide and step-by-step loan process walk through everything from application to keys.
Want to know if HomeOne beats FHA for your purchase?
What is a Freddie Mac HomeOne mortgage?+
HomeOne is a conventional, fixed-rate mortgage from Freddie Mac for first-time homebuyers. It allows financing up to 97% of the home's value, with no income limits and no geographic restrictions, on a 1-unit primary residence.
Who counts as a first-time homebuyer for HomeOne?+
Anyone who hasn't had an ownership interest in a home during the past three years. Only one borrower on a purchase needs to meet that definition, but every borrower must live in the home.
Is there an income limit on HomeOne?+
No. That's the main difference from Freddie Mac's Home Possible and Fannie Mae's HomeReady, which generally limit income to 80% of the area median.
What is the HomeOne loan limit on Long Island?+
HomeOne is not eligible as a super conforming loan, so the maximum is the 2026 baseline conforming limit of $832,750, even though the standard high-cost limit in Nassau and Suffolk is $1,209,750. Buyers who need a larger loan can still use standard conventional financing with as little as 5% down up to the county limit.
Can I get rid of mortgage insurance on a HomeOne loan?+
Yes. Borrower-paid private mortgage insurance can be canceled at your request once your balance reaches 80% of the home's original value, and it terminates automatically at 78%, provided you're current on payments. FHA mortgage insurance, by contrast, usually stays for the life of the loan when you put down less than 10%.
Can I use HomeOne to buy a co-op or a two-family home?+
A two-family home is not eligible, since HomeOne is limited to 1-unit properties. Co-op financing works differently from a standard mortgage and lender availability is limited, so ask a loan officer before assuming any low down payment program applies. Our condo vs. co-op guide explains why.
Program guidelines are based on Freddie Mac's published HomeOne requirements as of September 2026 and are subject to change. All loans are subject to credit approval, underwriting, and property eligibility. This article is for educational purposes and is not a commitment to lend. Coltrain Mortgage is a mortgage broker; all loans are arranged through third-party lenders. Equal Housing Opportunity.
- Freddie Mac Single-Family, HomeOne® Mortgage product overview
- Freddie Mac, HomeOne Mortgage fact sheet (September 2025)
- Freddie Mac Single-Family Seller/Servicer Guide, Section 4605.1, HomeOne Mortgages
- Freddie Mac, Maximum LTV/TLTV/HTLTV Ratio Requirements for Conforming and Super Conforming Mortgages
- Federal Housing Finance Agency, Conforming Loan Limit Values for 2026
- Consumer Financial Protection Bureau, When can I remove private mortgage insurance (PMI) from my loan?
