HomePath is Fannie Mae's exclusive program that allows a home buyer to purchase a Fannie Mae foreclosed home with as little as 3% down. One of the biggest benefits of this program is the ability to only put 3% down as a down payment while still avoiding paying mortgage insurance!
The HomePath program benefits include:
- No appraisal necessary
- No mortgage insurance
- As little as 3% down payment required
- Seller contributions of up to 6% of the purchase price
- Owner occupied, second homes and investment properties allowed
Here's a look at each of these benefits one by one:
The HomePath program states that an appraisal is not necessary. Since Fannie Mae already owns the property and will also be holding loan that the new buyer will obtain, they are allowed to set their own rules. Avoiding the appraisal means that the buyer does avoid the roughly $400 that an appraiser will charge for their service, however, critics claim that it puts the buyer at a disadvantage since they do not get an independent third party opinion of the value of the home. Of course, the buyer can choose to pay for an appraisal if they so wish, but it is not required.
No Mortgage Insurance
A typical home loan requires mortgage insurance if the buyer is putting less than 20% down. Mortgage insurance insures the lender and not the homeowner. Therefore, avoiding paying the monthly or upfront mortgage insurance premiums associated with most loans with small down payment amounts can offer huge savings to prospective home buyers.
3% Down Payment
The HomePath program has the lowest down payment requirements for an owner occupied property of any conventional loan available in the marketplace today. FHA loans require a minimum of 3.5% down and traditional conforming loans require at least 5% down.
The HomePath program allows Fannie Mae to offer as much as a 6% concession towards closing costs. This money can be used to pay for all third party fees allowing the home buyer to use their funds solely for their down payment.
**Special Bulletin** Fannie Mae is offering 3.5% towards closing costs on ALL HomePath loans closed before June 30, 2011
Second Home and Investment Properties
HomePath is available to those looking to buy a second home, invest in a rental property as well as those buying a primary residence. The down payment requirements may vary depending upon occupancy, but the requirements are less stringent than conventional financing for all occupancy types.
Click Get Rates to get an instant online rate and payment quote on a HomePath Mortgage.
Speak With A Loan Coordinator
Would you prefer to speak with a Loan Coordinator over the telephone? Please call us directly at 1-800-276-CYOL(2965) and choose option 1. Or, click here to have one of our experienced representatives contact you directly.