There are many reasons for buyers to look at a Fannie Mae HomePath purchase in this market. For example, on a HomePath purchase there is only a 3% down payment requirement for first time buyers, only 15% for investors, there is no appraisal required and there is no mortgage insurance on any of their loans. As Fannie Mae just acquired over 53k foreclosed properties in the first quarter, up from 46k in the previous quarter, it’s no surprise that they just announced that they are extending their incentives for buyers and agents to purchase HomePath properties through October 31st, 2011, as a way to get these properties sold as quickly as possible (see details below).

What is HomePath and what are the benefits to buyers

Fannie Mae at the end of last month had over 153k foreclosed properties on its books, these are all listed under HomePath, Fannie Mae’s REO division. HomePath allows a borrower to purchase these properties with a low down payment, flexible mortgage terms, no lender-requested appraisal and no mortgage insurance. Here are the main benefits for a HomePath buyer.

• Low down payment and flexible mortgage terms (fixed–rate, adjustable rate).
• Down payment (at least 3%) can be funded by the borrower’s own savings; a gift; a grant; or a loan from a nonprofit organization, state or local government, or employer.
• No lender-requested appraisal.
• No mortgage insurance.
• Only 15% down payment for investment properties.
• Only 660 credit scores required.
• Many condo project requirements are waived.

New HomePath Incentives for buyers and agents

Fannie Mae just announced last week that they are extending their special offer of up to 3.5% in closing cost assistance for buyers and a $1,200 bonus for agents on HomePath properties sold through Oct 31st, 2011. Here are the eligibility details to qualify for these incentives.

• Buyers must use home as their primary residence.
• Initial offers must be submitted on/after June 14.
• Buyers must use home as their primary residence.
• Buyers are required to sign an Owner Occupant Certification Rider to the Purchase Addendum with all initial offer submissions.
• Sale must close on/before October 31.
• Other restrictions apply. For more information about the offer, including the terms and conditions, visit the Special Offers tab on www.HomePath.com

Search www.HomePath.com for the most updated list of properties. And remember, all owner occupant buyers enjoy a 15-day “first look” preview of all HomePath properties — without competition from investors — through Fannie Mae’s “FirstLook” period.

Comparing a HomePath Purchase vs FHA for buyers

Check out this Homepath vs FHA $300k purchase scenario below that shows the benefits for the HomePath buyer over the FHA buyer. On the left column we have the FHA buyer who has to put down a minimum down payment of 3.5%, vs the HomePath buyer on the right who only has to put down 3%.

As you can see above, even though the FHA buyer has a lower interest rate, the HomePath buyer has an overall lower monthly payment and will save an extra $257 a month because there is NO mortgage insurance (MI) on their loan. Also, as the HomePath buyer is getting their closing costs paid for by Fannie Mae (see incentive above) their total cash to close is just $9k, vs the cash to close of $20,895 due from the FHA buyer if they don’t get their closing costs paid for.

Also, the longer term savings are also significant for the HomePath buyer. See below, over the next 10 years on this particular scenario, the HomePath buyer will save $33,544 vs the FHA buyer.

Getting signed up with HomePath

Here is a link to the HomePath site for additional information on how to sign up for HomePath alerts and available property info etc. For information on applying to become a Fannie Mae listing broker visit the Doing Business with Fannie Mae page.

We are an approved HomePath Lender

We are an approved Homepath lender and we have been helping many buyers qualify for the HomePath loan program recently, so if you ever have any HomePath questions or scenarios, please feel free to contact me directly at 858-200-9602. I look forward to chatting soon.

Tags: Fannie Mae HomePath, HomePath Loans, HomePath properties, How to Qualify for HomePath, Why Fannie Mae's HomePath Purchase is a Great Option For Buyers

This entry was posted on Wednesday, June 29th, 2011 at 6:47 pm and is filed under Why Fannie Mae's HomePath Purchase is a Great Option For Buyers. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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