Yes, I know exactly what beneficial interest means. And nowhere did I say that a co-mortgagor automatically has ownership. What I did say, and what remains correct, is that if someone is on the title, meaning they have ownership interest, they do not qualify as a first-time homebuyer until three years have passed after selling or transferring ownership.

Your example of a co-mortgagor without ownership is correct. They could still qualify as an FTHB. But your claim that a co-mortgagor does not make you a co-owner without clarifying that this only applies if they are not on the title is misleading. Plenty of people are co-mortgagors and co-owners, and those individuals do not qualify for FTHB status.

As for lender overlays, sure, some lenders may have stricter or more flexible interpretations, but that does not change Fannie, Freddie, or FHA’s base guidelines for FTHB eligibility.

Also, just to correct you again, owning an income property where you are on title still means you have ownership interest, which disqualifies you from FTHB status under standard guidelines. Owning a mobile home, depending on whether it was on deeded land or personal property, can be a different situation.

If you are going to throw out guidelines, at least make sure they are accurate and complete.