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The federal government helps support a number of programs intended to make easier for homebuyers to successfully purchase a home. HomePath is a program run by Fannie Mae, one of the corporations that the federal government administers to back home loans across the country.
HomePath is specific to properties that Fannie Mae owns and is moving to new homebuyers with easier-to-get-approved processes backed by the government.
This makes the process more attractive for lenders to participate in, knowing the federal government will take care of the loan if the homebuyer for some reason is unable to complete payments in full over the life of the mortgage.
HomePath are Foreclosed Properties, Right?
The properties involved are due to previous loans Fannie Mae backed through other federal programs where the homebuyers were unable to meet their obligations.
Through the foreclosure process, the Fannie Mae gained titled to the properties via deed-in-lieu of a foreclosure, essentially forgiving that prior lender of their obligation in exchange for the property title.
This means there is no further attachment to that prior lender. Fannie Mae can resell the property clear and free to a new buyer.
These properties are very good opportunities for new homebuyers because the pricing is often very competitive and Fannie Mae controls the mortgage process as well, both intended to move the property and get new buyers into homes affordably. So, in essence, a HomePath property is more than just the reselling of a foreclosed home.
Who is the Program For?
Who buys Fannie Mae homes via HomePath? All types of folks. It could be buyers who want a second vacation home in a different location, first time homebuyers, real estate brokers looking to add to their inventory for their customers, and folks who need to move across the country due to work or life changes.
Most homes are complete and move-in ready with finished landscaping. The pricing of the property depends on the local market and the condition of the home when Fannie Mae took over. All of the available Fannie Mae properties eligible for the HomePath program are listed on their website under the More Resources section of HomePath.com. Alternatively, one can call a Fannie Mae Resource Center for information by phone at 1-800-2FANNIE.
Benefits of a HomePath Mortgage
A HomePath property can take advantage of the HomeReady Mortgage, which Fannie Mae supports, and makes the home loan involved far more affordable.
There is also the HomePath Ready Buyer Program, which can reduce closing costs by 3 percent. The HomePath loan is a third option, which should definitely be considered. It can require a small or no down payment, it is intended for low- or moderate-income buyers who have difficulty with traditional mortgage approval, and HomePath loans can remove the credit insurance requirement when 20 percent equity is attained in the life of the loan.
The process is managed through specific agents and lenders, and Fannie Mae supports the HomePath program as the financial backer and underwriter of the local mortgage approved.
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