Fannie Mae’s HomePath Program Offers New Incentives for Foreclosed Properties
The HomePath program offered through Fannie Mae is providing attractive incentives to prospective home buyers looking to save money on a home purchase. As a part of the program, Fannie Mae is selling foreclosed homes with low down payments and other incentives that could make buying a home easier for the person on a budget.
Fannie Mae’s HomePath Mortgage program allows a borrower to purchase a Fannie Mae-owned property with a number of incentives to lower the final cost. Incentives include:
- Low down payment (starts at 3 percent)
- Flexible mortgage terms (fixed-rate, adjustable rate, or interest-only)
- Down payment can be funded by borrower, or through a gift, grant or loan from nonprofit organization, government entity or employer
Also, it’s good to note there are no lender-requested appraisals because Fannie Mae owns the property. The buyer will not need mortgage insurance to cover the balance of the down payment (20 percent is normally required) and expanded seller contributions will be allowed.
While the program is advertised to buyers purchasing a primary home, individuals looking to buy foreclosed properties as second homes or investment options are able to participate as well. The difference, however, is that only primary homes are able to qualify for 3.5-percent closing cost assistance.
For individuals looking to make renovations to a foreclosed property, Fannie is also offering HomePath Renovation. The program will allow individuals to borrow up to $35,000 to purchase a property that requires light-to-moderate renovation.
On all HomePath purchases, expect the mortgage rates to be a bit higher (usually about 1/8th to 3/8th of a percentage point higher) because of the multitude of incentives being offered.
The HomePath program is set to end on Oct. 31, so if you want to jump in on these incentives, now’s the time to act.
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