Fannie Mae RefiNow 2026: Eligibility, Rate Reduction Test, and Borrower Benefits

Fannie Mae RefiNow is the counterpart to Freddie Mac's Refi Possible. Both programs target low-to-moderate income borrowers with existing agency loans and give them a preferential refinance path with a $500 appraisal credit. The eligibility requirements are similar but not identical.

RefiNow Core Requirements

• ✦Borrower income at or below 80% of AMI for the property location
• ✦Existing loan must be Fannie Mae-owned (verify at KnowYourOptions.com or via servicer)
• ✦Minimum 620 FICO (Fannie Mae sets this floor directly, not just lender overlays)
• ✦Maximum 97% LTV on primary single-family residence
• ✦Rate must decrease by at least 0.5% AND combined rate-and-fee must also meet the test
• ✦Maximum 65% DTI at time of refinance
• ✦Primary residence only

Combined Rate-and-Fee Test

RefiNow requires that the new rate be at least 0.5% lower AND that the new rate including fees (APR-equivalent) also be lower. This prevents lenders from meeting the 0.5% rate drop by loading up on points that offset the savings. The borrower must realize a genuine net benefit, not just a rate drop on paper.

$500 Appraisal Credit

Fannie Mae provides the lender a $500 credit upon delivery of the RefiNow loan. The lender must pass this credit to the borrower as a closing cost reduction. If the property qualifies for an appraisal waiver (Fannie Mae's automated valuation), the credit converts to a cash benefit to the borrower at closing.