Is Fannie Mae Homepath A Good Option For First Time Home Buyers?

By Simon Volkov

Fannie Mae Homepath is a government-sponsored home buying program that offers discount-priced foreclosure homes. Buyers can apply for financing through Home Path Mortgage to receive special incentives and low-interest mortgage loans.

Additionally, many of the Fannie Mae Homepath properties are eligible for Neighborhood Stabilization Program grants offered through the Department of Housing and Urban Development.

First time home buyers find Fannie Mae homes attractive because they are often priced 10- to 20-percent below market value. Although foreclosure houses often require repairs, these costs are factored into the purchase price.

One attractive financing feature offered through Home Path Mortgage is the option to apply for renovation loans to offset repair costs. When buyers purchase houses requiring repair work through conventional mortgage lenders they may not qualify for construction loans.

Those who do qualify are often forced to pay higher interest rates and then refinance mortgages into a conventional home loan once repairs are complete. This can add a substantial sum to the overall cost of the mortgage loan.

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First time home buyers who have not established a strong credit history find Home Path Mortgage a good option because lending criteria is not as stringent. This program has a minimal down payment requirement which makes it attractive to those who cannot afford a large down payment.

Fannie Mae Homepath homes can make the perfect first home, but buyers should take time to thoroughly research the property and obtain repair cost estimates. The Fannie Mae website provides pertinent information which should be reviewed by first time home buyers who have never undergone the process.

Buyers of Fannie Mae foreclosure real estate will need to obtain preapproved financing before submitting purchase offers. It is important to realize that “preapproved” does not equate to “approved” financing. Instead, it shows lenders how much buyers can afford and reflects they may qualify for financing as long as the purchase price falls within a specific price range.

One consideration of submitting purchase offers for Fannie Mae Homepath properties is chances are high multiple offers will be submitted for the same property. Many of these houses are sold within days after being listed on the Fannie Mae website. It is strongly recommended to submit the highest offer upfront.

Fannie Mae rarely entertains offers for less than the asking price. The only possibility of buying these houses for less than the asking price is if substantial damage is discovered during property inspections that were not revealed when property was repossessed.

Buyers who purchase Fannie Mae homes in communities where foreclosure rates are high might qualify for NSP grants. Each state receives allocated funds annually which must be used to buy, sell, or rehab foreclosure homes which meet the criteria. This is a great way to offset repair costs or reduce the overall cost of foreclosure homes. Interested buyers can review details of HUDs NSP grant program at HudNSPHelp.info.

Fannie Mae Homepath properties can be a rewarding choice for buyers uncertain of whether now is the time to buy a house. Declining property values have scared many people from buying houses, along with financing restrictions.

Only you can decide if now is the time to take the plunge. If so, take time to research availability of NSP grants and Home Path Mortgage financing options. Combining these programs with the purchase of Fannie Mae Homepath properties can potentially yield substantial savings.

About the Author: In addition to being a good option for first time home buyers, Fannie Mae Homepath can be a good choice for investors. Real estate investor, Simon Volkov shares additional information and resources about buying foreclosure homes via his investing website at SimonVolkov.com.

Source: isnare.com

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