The Home Buyer's Korner

Information presented should be used for educational purposes only.

July 28th, 2014

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 Fannie Mae HomePath Properties

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HomePathFannie Mae offers Home Buyers and Property Investors some unique opportunities to purchase a home with extremely attractive features. Many homes are offered at a discounted price and some include up to $35000 you can include in a low interest rate mortgage to update, remodel or address any necessary repairs.  Qualified home buyers with FICO Scores of 660 or higher can purchase homes with just 5% down payment and NO mortgage insurance. 

Some lenders will allow FICO Limits down to 620, but often requires 20% down payment, whereas a 660 score or higher often allows for just 5% down payments. Home buyers can however secure second liens up to 15% in many cases.  Any 2 to 4 Family property requires a 30% down payment and no secondary financing.  Fannie Mae HomePath can be used by home buyers and property investors to purchase distressed and non-distressed homes owned by Fannie Mae.  Lenders are requiring Home Buyer FICO scores of at least 620 and property investors will need a FICO of 700 or higher.

The HomePath Renovation mortgage program allows home buyers to combine the cost of the home with the costs for renovation or remodeling. At closing, all funds for renovation will be escrowed in an interest-bearing account with disbursements as your renovations are completed with a final draw at your last passed home inspection.         

Fannie Mae HomePath Renovation Loan Highlights:

  • Up to 95% LTV with No MI;
  • Renovation funds escrowed in an interest bearing account;
  • Soft costs (architectural services, engineering, permits, etc.) may be financed;
  • Loans are underwritten to standard FNMA guidelines
  • Loan Amount to $417,000;
  • 1 & 2 Family Units /Modular/PUD/Approved Site Condos;
  • Can own up to 10 properties including your Primary Residence.;
  • FICO Scores down to 620 with specific limitations  to LTV;
  • Fixed Rate Loans with 15 and 30 yr terms and no prepayment penalty;
  • Up to 3 months of payments can be included in the loan amount.

Home Buyers can basically do any repairs or renovation to the home that they want as long as the appraisal supports the improved value, the improvements are common for the area (pools, for example), the repairs must be completed within  three months, and the repairs do not exceed 35% of the after improved appraised  value.

Today, the maximum number of allowable simultaneously financed properties is 10 and the policy applies to Fannie Mae HomePath programs. As part of Fannie Mae’s Housing Stabilization efforts their policy remains in effect and encourages experienced investors play a key role in the housing recovery, by continuing to offer renovation lending tools to the property investor community with its HomeStyle and HomePath Investor Financing Programs.  If you are a real estate investor looking for a lending tool to renovate and create a nice portfolio of one to four family units consider either programs.

To finance a home via Fannie Mae’s 5-10 Properties program the following criteria must be met:

  • Own between 5 and 10 residential properties, each with financing attached;
  • Purchase: 30% down payment is required for 1 to 4-units;
  • Minimum credit score for most lenders is at least 700;
  • No mortgage late payments within the prior 12 months on any mortgage;
  • No bankruptcies or foreclosures in the prior 7 years;
  • Two years of tax returns with rental income from all rental properties;
  • Six months of PITI reserves on each of the financed properties.
  • HOME OWNERSHIP TOOLS

    FHA 203K

    Your Home Purchasing or Refinancing & Renovation Tool

    Mortgage Loan Officers, Real Estate Agents & General Contractors

    are ready to assist you with your home purchase

    FANNIE MAE HOMESTYLE

    The Conventional Alternative to FHA 203K

    Great for Real Estate Investors and Second Home Renovations

    You Mortgage Loan Officer, Real Estate Agents & General Contractors

    are ready to assist you with your home purchase

    FANNIE MAE HOMEPATH RENOVATIONS

    Rebuilding the Dream of Home Ownership

    Fannie Mae HomePath has No Mortgage Insurance up to 95% LTV

    Up to $35K for Home Improvements, Renovations or a Simple Remodel

    Your Mortgage Loan Officer, Real Estate Agents & General Contractors

    are ready to assist you with your home purchase

    USDA RURAL DEVELOPMENT

    Up to $10K for Home Improvements, Renovations or a Simple Remodel

    Your Mortgage Loan Officer, Real Estate Agents & General Contractors

    are ready to assist you with your home purchase

    A SIMPLE HOME SHOPPING INSPECTION TOOL

    Organizing your home shopping experience affords a wise decision making process.

    This simple home inspection tool makes your ultimate buying decision a smart one.

    To print this document click on “Open in New Window” located at the lower right corner; click on “File”; then click on “Print”. In the center of the screen you will have the option to “Create A Printable PDF of the Presentation”.

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