Fannie Mae HomePath Mortgage Loan: The Good, The Bad, The Ugly…
Considering purchasing a foreclosed property? Let’s take this a step farther and say this property is a Fannie Mae foreclosure. Well if that turns out to be the case than you would be crazy not to participate in a Fannie Mae HomePath mortgage. Why you ask? For starters, unless you are renovating the home, no appraisal is required. If you wish to purchase and renovate you can still use a HomePath mortgage you would just need to then purchase an appraisal so we could evaluate the “after improved” value.
Either way it’s a great option when you are in the market for a new home.
The Good:
• Low down payment as little as 3% and it can be a gift
• No monthly mortgage insurance
• The loan amount can go up to conforming loan limit of $417,000 (in Texas)
The Bad:
• This program is limited only to Fannie Mae Foreclosures
• When doing renovation the max allowed is $35,000.00
The Ugly:
• Honestly, this might or might not be the actual condition of the home but if it is there is a great renovation program available called the Fannie Mae HomePath Renovation loan – useful for elective cosmetic updating as well as required repairs
In this current market trying to find a “move-in ready” home is nearly impossible. Sure they are out there but from what I’m hearing it’s a bidding war nightmare. This is why having an option to purchase a foreclosed property under the HomePath program is such a nice option. Couple this with renovation, the Fannie Mae HomePath Renovation loan, and now you truly have the home you want at a great price and a low down payment.
For a buyers agents, how great will it be to not hear I wish the owners didn’t paint this room purple and that room lime green! That will no longer be an issue with the Fannie Mae HomePath Renovation Loan. In all honestly, not all foreclosed homes are in the best condition. In fact, most in Texas need foundation work. Well that’s not a problem under this loan. Give your clients the option to do it all and then you will look like a rock star at the end of the day.
As an added benefit this program does allow for financing of Second homes and Investment properties. Investors like this program because it allows for them purchase as well as renovate in one simple loan.
The only downside to this program is that it can only be used on Fannie Mae owned properties…but if you are buying or selling a Fannie Mae property these programs are great! Give me a call today and let’s discuss Fannie Mae HomePath Mortgage Loan: The Good, The Bad, The Ugly. My team and I are available to make this a smooth transaction.