The HomePath Mortgage is a program that was created by Fannie Mae due to the large number of homes that were obtained by Fannie Mae through foreclosures. HomePath financing is only available on foreclosure homes being sold through Fannie Mae and HomePath. There are three main components loans have sweetening the financing offer to entice home buyers, all of which are explained below.
HomePath Mortgage allows a borrower to purchase a Fannie Mae owned property with a low down payment, flexible mortgage terms, no lender-requested appraisal, no mortgage insurance, and expanded seller contributions. The final sales price is used to underwrite the loan. Examples of benefits borrowers incur include 3% down payment on owner occupied properties and no Mortgage Insurance Premiums. Loans are available for owner occupied properties, as well as investment properties. Fannie Mae uses the sales price as it’s valuation, therefore no appraisal is needed.
Loan limits are set up to $729,750. This is dependent upon the properties location for a single family home. Four unit loans are available up to $1,403,400 in high cost areas. Although a minimum credit score of 600 is required by Fannie Mae, most lenders will require a higher score and you must meet the most restrictive requirements to get the loan. Borrowers must have 5% of their funds towards the purchase price.
Whether you are a first time home buyer or a seasoned investor, it is recommended to work with an experienced HomePath lending specialist and a seasoned agent who understands the guidelines required and who can clearly explain your options. For more information, feel free to contact us here at Mountainscape. Good Luck!