Feb 7, 2022 2022-03

Choosing the right Fannie Mae HFA Preferred™ Program

HFA Preferred™ conventional loans are divided into two categories: borrowers with income at or below 80% area median income (AMI), and those above 80 percent AMI as defined by Fannie Mae.

Special benefits are given to borrowers with income at or below 80% AMI:

  • The interest rate set by MFA will be comparatively lower; and
  • Fannie Mae only requires 18% MI coverage for a 97% LTV.

Borrowers above 80% AMI will have a slightly higher interest rate and are required to purchase standard MI coverage of 35%.

The AMI classification is determined by the AUS/DU findings. A message will appear in the findings if the borrower’s income does not exceed 80% AMI. If said message does not appear, the borrower is considered above 80% AMI. 

Please note that AUS/DU for borrowers above 80% AMI may contain a message stating coverage of at least 18% MI may be obtained with a loan level price adjustment (LLPA). LLPAs are collected at the time of purchase if not collected at loan closing.

It is the sole responsibility of the lender to lock loans based on Fannie Mae’s income limits.   

To make this determination, AUS/DU factors in the total qualifying income (not MFA income) and the address of the subject property. Fannie Mae’s AMI lookup tool may be used by lenders to make a preliminary assessment prior to running AUS/DU:


Should you have any questions, please contact an MFA homeownership representative at 505-843-6880 or by email: singlefamily@housingnm.org.


Thank you for participating in MFA programs.