Is Homepath the Future

Most have heard of Homepath - for those that haven't - Homepath is a financing solution offered by Fannie Mae for homes that are distressed properties that would have trouble qualifying for typical financing solutions due to their distressed nature.

With that said this program is not a fix all solution for a singular reason, Homepath financing solutions are only available to homes that have been Homepath approved. This means many homes will not be eligible for for this type of financing, regardless Homepath does present a significant opportunity that we should all be aware of.

First and foremost Homepath financing is for foreclosed Fannie Mae homes, so you will not find these properties on every block in town. Homes that are qualified for Homepath will have the "Homepath"logo attached to their listing. If a home is Homepath approved here are some of the advantages this financing solution offers:

Low down payment (3%) that can come from personal savings, a gift, a grant, a loan from a non profit (down payment assistance programs), state, government, employer. Point in fact, the down payment options are significant and the required down payment is less what FHA now requires.

Fixed, Adjustable, and interest only financing options are available - flexible final loan terms mean borrowers can fine tune their final loan to meet their personal goals.

Less than perfect credit is allowed... this is not designed for only prime borrowers to qualify.

Is available for both primary residences and investment properties - investors this is a significant opportunity.

No mortgage insurance. That's right there is no mortgage insurance associated with this program even if your loan is over 80% loan to value. All I can say about this is WOW!

No appraisal fees. A lot of people will see this as the final selling point. Although buyer's agents you may still want to recommend having you clients get an appraisal to confirm they are not over paying for the home.

And finally Homepath also offers a light renovation option for homes that need work to be completed before they are truly livable. Imagine funding your renovations inside your purchase loan. Years ago this was a common occurrence with financing vehicles like construction to permanent, but since the credit crisis these loans have all but disappeared. This is not the case anymore.

Needless to say Homepath is a significant opportunity. and I am proud to offer it as a financing solution to borrowers... agents, keep a close eye out for these properties. Distressed homes are not that much fun to list, however a Homepath approved home for sale does not have the headaches that use to come with this type of listing. The benefit for buyer's is obvious - those looking for a true fixer-upper can now secure financing for their new fixer-upper.

Leave your questions and comments about Homepath - share your current experiences - and if you have specific questions about a case you are trying to secure financing for we are of course available for confidential consultation.