What is Family Opportunity Mortgage

Jul 28, 2023 By Susan Kelly

Are you a family looking to buy or refinance a home? If so, the Family Opportunity Mortgage may be an ideal solution. The Family Opportunity Mortgage allows families and extended family members to purchase or refinance homes with special terms unavailable to the wider public.

This innovative loan program opens up housing opportunities for many households by providing flexible options when obtaining mortgage financing.

Keep reading below to learn more about this specialized mortgage option - including what types of relatives are eligible and how it differs from other mortgage products.

Family Opportunity Mortgage (FOM)

A Family Opportunity Mortgage is a type of mortgage offered by Fannie Mae which enables parents to purchase a home for their children, such as adult children with disabilities or children attending college in another city, while still receiving the benefits of the mortgage loan.

This program allows parents to co-sign the loan and receive favorable terms without being obligated to make payments or become the primary homeowner.

The Family Opportunity Mortgage allows parents to help their children and offers several other benefits. It provides a great opportunity for parents to help their children buy a home with lower interest rates and more favorable terms than they would receive on any other type of loan.

Additionally, this program can be an alternative to traditional loans, such as reverse mortgages. This type of loan can also provide a tax benefit, as the interest paid on the loan may be deductible from your taxes.

The Family Opportunity Mortgage provides an ideal solution for parents who want to help their children purchase a home but need help to commit to making payments or becoming the primary homeowner.

With this program, parents can secure favorable terms and rates on the loan without taking on any associated risks. This can provide peace of mind for parents and children, knowing their financial commitment to the loan is minimal and secure.

Who Qualifies for a FOM Loan

Family Opportunity Mortgage loans are available to families who wish to provide housing for their elderly, disabled, or student relatives. To qualify for a FOM loan, the borrower must meet specific criteria:

  • The family member being helped must be either an elderly parent over 62, a disabled adult child under 18, or a full-time student between 18 and 24 years old.
  • The family member must be related to the borrower by blood, marriage, or adoption.
  • If purchasing for an elderly parent, the parent must not have more than one residence in their name at the time of purchase.
  • The borrower must own fewer than ten properties (principal residences, second homes, investment properties)
  • The borrower's credit must meet Fannie Mae's credit criteria.

This type of loan allows family members to assist relatives by providing them with an affordable housing option that would otherwise be out of reach. A Family Opportunity Mortgage can help relieve financial burdens and reduce stress on extended families.

The loan process for a FOM loan is similar to other mortgage loans, meaning the borrower will need to provide income and credit documentation. The loan amount can be up to $5 million and can be used for a primary residence, second home, or investment property.

Benefits of a FOM Loan

A Family Opportunity Mortgage (FOM) loan can provide numerous unique benefits to borrowers looking for an affordable way to purchase a home for their family members. FOM loans allow borrowers to:

1. Purchase a primary residence for elderly or disabled family members at market rate and without additional down payment requirements;

2. Receive more favorable terms on a mortgage loan, including lower interest rates;

3. Include non-occupant family members in the loan approval process and utilize their income to qualify for the loan;

4. Have more flexibility when it comes to credit score and debt-to-income requirements; and

5. Take advantage of special tax incentives afforded by FOM loans.

FOM loans are a great option for those who want to provide housing for their elderly or disabled family members affordably and efficiently. By utilizing the benefits of the FOM loan, borrowers can ensure that their loved ones will have an adequate place to live without incurring unnecessary financial burdens.

Requirements of a FOM Loan

A Family Opportunity Mortgage, or FOM Loan, is a program designed to help families that have members with physical disabilities qualify for a mortgage loan. The program allows families to purchase property closer to family members who cannot move away from their current location due to medical needs.

Additionally, it helps parents age 62 and over purchase a primary residence for their college-student children without applying for another loan program.

The FOM Loan is similar to a traditional mortgage in that it requires applicants to have good credit, sufficient income, and the ability to make a downpayment.

However, certain requirements differentiate FOM Loans from traditional mortgages:

  • The family member with physical disabilities must be listed on the home deed or be the borrower.
  • The primary residence must be within a reasonable distance from the family member with physical disabilities.
  • Applicants must provide documentation that proves their relationship to the family member with physical disabilities and that they are providing care for them.
  • A FOM Loan can only purchase a single-family unit.

FOM Loans are becoming increasingly popular due to their flexibility and the fact that they allow families to stay together and take care of each other. They can also help applicants secure a lower interest rate than is typically available with traditional loans, making them even more attractive.


Can you have a family mortgage?

A Family Opportunity Mortgage (FOM) is a loan designed to help families provide housing for their elderly parents, disabled adult children, and other close relatives who cannot obtain traditional financing. This type of mortgage is available through many lenders and can be used to purchase or refinance an existing home.

Can I buy a primary residence for my parents?

Yes, you may be eligible to purchase a primary residence for your parents if they cannot qualify for financing independently. To qualify, the relative must live in the home and document that they cannot obtain traditional financing due to physical or financial handicaps.

How many people can be on one mortgage?

The number of people who can be on a FOM mortgage depends on the lender. Generally, you can have up to four family members on one loan, including yourself and the relative living in the home.


A Family Opportunity Mortgage (FOM) is a great opportunity for families to support their loved ones needing a home. The FOM loan allows eligible families to purchase homes accommodating a family member with physical or mental handicaps. It also offers generous terms that make it easier for the buyer to secure the home they desire, including lower down payments, fewer restrictions on income, and large loan limits.

Qualifying criteria for this mortgage is pretty straightforward, but certain documents are involved in the application process. To be sure you have the best chance of getting approved, be prepared by having your credit report ready, valid proof of income, and clear ownership documents for the proposed property.

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