BLOG: Fannie Mae's HomePath program

Three percent down, no appraisal, no mortgage insurance and have the seller pay for fees?!

How can buying a home be so easy and cost effective? Fannie Mae HomePath  may be the best way to do it and it has easy qualifying guidelines also.

This slow economy has brought many bad things to the mortgage industry and home values. Everywhere you look there are foreclosures happening! Foreclosures for people who are down on their luck or people walking away from homes disillusioned by the property values dropping so much… This one I don’t respect. 

But regardless of the reason, foreclosures are happening at a rate much faster than ever. 

The banks who own these foreclosed homes are either writing off their losses and abandoning the homes or they look for ways to make it easy for buyers to purchase the home. That is where Fannie Mae’s HomePath program comes in. 

Fannie Mae has been stuck with many foreclosure properties that it now owns, so to make it easier for buyers to purchase these homes, officials there have made their guidelines more flexible and are willing to waive fees and even finance the cost for home improvements.  

With mortgage rates being at historic lows (a benefit from this slow economy), this may be the perfect time to buy. This program is available for owner-occupied, second homes and for investment properties also. So if you were thinking of expanding your real estate portfolio, this may be a good option. 

The only catch is that this program is only available for Fannie Mae REO (real estate owned) properties. It is easy to look for homes available in the neighborhood that interest you, simply visit HomePath’s home page.

Here is a list of HomePath’s money saving items:

• Appraisal – There is no appraisal necessary for financing because the financing is done by Fannie Mae.
• Mortgage Insurance – Any mortgage above 80 percent loan-to-value requires mortgage insurance.  But Fannie Mae waives this requirement for HomePath homes, and it self-insures the loan.
• Closing costs – You can negotiate to have Fannie Mae pay for part or all of the closing fees. Your Realtor can negotiate this.
• Home Improvements – We all know that REOs are normally not properties in great condition. So costs to make repairs and improvements can be financed up to $35,000 with HomePath’s Renovation program http://www.homepath.com/financing.html. An appraisal is required in these cases.