Buying a Fannie Mae HomePath Home can be confusing in the beginning to navigate through the process. These are foreclosed homes and can be great buys for everyone from the first time home buyers to the savvy investor.
Who Is Fannie Mae?
Fannie Mae stands for The Federal National Mortgage Association (FNMA) that was founded in 1938 by congress during the Great Depression.
This government organization does not originate mortgages, instead they purchase and insure them from banks and credit unions on the secondary market. In fact, Fannie Mae and “brother” Freddie Mac are the largest purchasers and insurers on the secondary market. This allows the banks more liquidity to be able to underwrite and fund new loans.
Hopefully I have not confused/bored you yet… There are many benefits of both Fannie Mae backed mortgages, and financial opportunities found in Fannie Mae HomePath foreclosed properties.
What is a Fannie Mae Homepath property?
Fannie Mae strives to encourage home ownership and retention with counselors and special financing and loan modification programs.
Unfortunately, not all homeowners are able to avoid foreclosure, and Fannie Mae has to take possession of the property back, making it an REO (Real Estate Owned) property, and it is now referred to as a HomePath Property.
The goal of Fannie Mae is to resell HomePath properties quickly because vacant properties are liabilities. Essentially they are in the business of buying and insuring loans. They do not want to own vacant homes with defaulted mortgages.
Can Anyone Buy A Fannie Mae Homepath Property?
Yes! But to put it simply, you need to qualify for financing the home, or have enough cash to finance it.
Some properties have a special “First Look” program that allows 20 days for an owner occupants, public entities, and some non profits to purchase the home before it goes onto the open market. This is beneficial those that are competing with cash and for profit investor buyers. You can look for the logo below, or have your real estate professional assist you with looking for these specific properties.
How To Finance A Fannie Mae Homepath Home
Depending on your qualifications, you can obtain a regular conventional loan from your bank or mortgage lender. Most conventional loans only require a minimum of 5% down.
These properties can also be financed with FHA or VA financing (depending on the condition of the home) if you are looking for a lower down payment, or have past credit issues.
HomePath also offers special financing programs and incentives with their own loan options. Some even include paying your closing costs, or lending you money for renovations.
Homepath Properties For Sale