Posts Tagged ‘buying foreclosed homes’

Fannie Mae paying closing costs on HomePath

April 13, 2011

Breaking news… starting April 12, 2011, Fannie Mae is paying 3.5% of the purchase price towards a buyers closing costs when the buyer purchases a HomePath eligible property.

Great!… but what is a HomePath property?

HomePath properties are Fannie Mae owned foreclosures. This plan to pay 3.5% of a buyers closing costs is designed to encourage qualified buyers to get into the market and purchase some of these foreclosed homes.

What does one need to do to qualify:

  • get prequalified for a loan (credit, income, down payment)
  • plan to reside in the home as one’s primary residence (closing cost incentive not eligible on investment property purchases)
  • close on the HomePath property on or before June 30, 2011

Starting from the day of this post, you have 6 weeks to find the property, and then another 4 weeks to close on the loan before the end of June. That is sufficient time, but not a ton of time. Also like other credits and incentives, the closer we get to the end date, the busier things tend to get.

In other words, start early! To get started, contact me to be prequalified to buy a home as long as the property is in the state of Georgia. The next step would be to find a home, and you can search for HomePath properties at https://www.homepath.com/

Free money to your closing costs! How can one go wrong with that!?!

Fannie Mae HomePath Mortgage

February 8, 2011

About a year ago, Fannie Mae created this loan program to help sell properties they own. Most of these properties are foreclosures. When the program was initially rolled out, I threw up a blog post about the details. It has been a year, and some of the guidelines have loosened up… so it seemed like a good time to revisit this loan program.

The HomePath Mortgage program has some major selling points.

  • available for primary residence, second home, and investment purchases
  • borrowers only need a 3% down payment to get started
  • non-occupant co-borrowers are allowed with a 5% or greater down payment
  • allows for sellers to contribute up to 6% of the purchase price toward a buyer’s closing costs and prepaids (typical amount with less than a 10% down is only 3% toward contributions)
  • no appraisal is required
  • no private mortgage insurance will be on the loan regardless of the size of the down payment

Some of the changes that have occurred over the past twelve months include the qualifying credit score being lowered to 660 and investors now only need a 15% down payment to qualify. On all other conventional loan programs, investors need at least a 20%-25% down payment to get started. A requirement of only 15% down is a big deal in the investment purchase market.

Again, Fannie Mae designed this loan program to facilitate the sale of homes they own. There are numerous properties available, and you can search for them here. That being said, do proceed wisely. I’m not saying anything is wrong with the homes, but one should:

  • as with any home purchase, hire someone to do a thorough inspection of the home
  • since there is no appraisal required for the loan, I would ask your real estate agent to conduct research on the home against recent sales in the area to ensure the purchase price is a good deal for you
  • some of these homes will probably be classified as being purchased “as is,” so don’t expect the seller to do many (if any) repairs to the home prior to purchase

Anyone interested in making an offer on a home to take advantage of a loan program that doesn’t require an appraisal or private mortgage insurance will need a prequalification letter, and that is something I can assist in providing! If you are looking to get prequalified, learn more about interest rates for this program, total monthly payments, etc., feel free to call or email me. It would be my pleasure to help you through the mortgage process!