Fannie Mae, the largest source of mortgage money in the country, is working to reduce foreclosure inventory or “real estate owned” properties (REOs). Fannie Mae is promoting The Home Path financing program for owner-occupants, second-home owners and investors.
The HomePath financing program offers:
3 percent down payment options for owner-residents
10 percent down payments for second-home buyers
15 percent down payment plans for investors on Fannie Mae REO properties
No declining market restrictions
Rehabbing like 203K
Fixed rate, adjustable, or interest only terms
Earnest money deposits as low as $500.00
Purchasers need to borrow at least $50,000 and usually need to a 660 credit score.
The down payment (at least 3 percent) can come from savings, employer, gift, grant, or a loan from a nonprofit organization, state or local government. The program offers no appraisal requirements and no mortgage insurance.
Many deals fall apart over appraisals, so eliminating this improve certainty and cost reduction. Eliminating mortgage insurance can equate to an approximate 0.75 percent savings on an interest rate (5.5 percent instead of 6.25 percent).
Special financing makes sense, especially now, given the credit-tightening restrictions making the sale of REO and conventional homes increasingly difficult. Check out this HomePath program for Washtenaw homes and condos here. The Michigan FHA limits still apply. Check out Ann Arbor foreclosure deals.
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