A Fannie Mae HomePath property offers prospective buyers a unique opportunity to save money on the cost of a home. HomePath is a program offered by Fannie Mae that helps homebuyers finance the cost of a foreclosed home with special financing options.
Like the Federal Housing Authority (FHA), Fannie Mae guarantees home loans. This means that when a borrower stops paying his or her mortgage, Fannie Mae has the right to take control of the property to recoup some of the money owed.
Unlike FHA loans, however, Fannie Mae home loans that go into foreclosure sometimes have the option to enter into “deed in lieu.” This occurs when a homeowner voluntarily gives up the home when he or she can no longer make payments.
As such, HomePath properties are often in much better condition than homes that are seized involuntarily. Sometimes, Fannie Mae may even pay for certain repairs or renovations on a home prior to listing it for sale.
However, it is important to note that all HomePath properties are sold “as is.” This means that buyers are responsible for any issues that may arise after the close of the sale.
Through HomePath, Fannie Mae attempts to sell these foreclosed properties as fast as possible. To encourage a quick sale, it offers various incentives for prospective buyers. Most HomePath homes are listed below market value to attract prospective buyers.
When you purchase a Fannie Mae HomePath property, you could receive the following financing perks:
- Low down payment requirement – If you qualify, you could pay as little as 3% for this type of conventional mortgage. Most conventional mortgages require 10 to 20% up front.
- Closing cost assistance – First-time buyers may get up to 3% in closing cost assistance if they reside in the home as their primary residence and complete an education course.
To purchase a Fannie Mae HomePath property, borrowers must complete the HomePath Ready Buyer education course. This course also qualifies borrowers for the 3% closing cost assistance; they will need to provide proof of completion at the time of closing.
Interested in buying a HomePath property, but not sure where to look? Fannie Mae has a database of all available properties that you can use to search for homes. You can search by city, state or zip code, or choose the advanced search option to add more filters.
You can find nearly any type of home in the database, including:
- Single-family homes.
- Multifamily homes.
- Manufactured housing.
When you find a Fannie Mae HomePath property that you are interested in, you can contact the real estate agent responsible for the listing. This is the only way to make an offer; Fannie Mae only allows real estate agents and Realtors to make bids on HomePath homes.