Fannie Mae HomePath Financing for REOs
The nation’s largest mortgage lender, Fannie Mae, has announced a new financing program called the HomePath program. This program is intended to help reduce Fannie Mae’s inventory of real estate owned property (REO) by attracting investors, owner occupants, and second home owners.
The HomePath financing program offers various down payment options depending on the type of buyer
- 3% for owner occupant
- 10% for second home buyer
- 15% for investors
To even further attract buyers, this financing program eliminates the appraisal requirement and mortgage insurance. Often times in real estate, delays of closing escrow come from third party elements such as getting an appraisal, termite inspection, and home inspection. It is not uncommon for there to be several appraisals on a property because of difference of opinions from one or more parties involved with the sale of the home.
Another interesting aspect of the HomePath financing program is the no-declining market restriction. The mortgage is only restricted by the amount of the down payment.
There is also the Home Path Renovation Mortgage which is similar to the FHA 203K which allows the buyer to borrow money to make repairs on the property for them to live in.
Fannie Mae has made these financing options available for potential buyers in an effort to reduce their REO inventory, but only time will tell if buyers will use this type of financing. To view a list of mortgage lenders honoring Homepath Financing, visit http://www.fanniemae.com/homepath/financing/lenders-list-2010-eng.html;jsessionid=LJIMML2UOTHDTJ2FECISFGI.