Has Fannie Mae pulled their head out of their... sand box?
What if I told you Fannie Mae is offering special financing if you buy one of their bank owned homes? Would you believe me? Well you should because it is true!
Why does this benefit you? Well frankly... the terms of their offered financing is pretty darn sweet!
The benefits of their HomePath program include:
- Low down payment and flexible mortgage terms (fixed-rate, adjustable-rate, or interest-only)
- You may qualify even if your credit is less than perfect
- Available to both owner occupiers and investors
- Down payment (at least 3 percent) can be funded by your own savings; a gift; a grant; or a loan from a nonprofit organization, state or local government, or employer
- No mortgage insurance
- No appraisal fees
- FREE home warranty is included with the purchase.
I recently wrote a blog about another local Sacramento Agency that is offering a similar incentive if you buy one of their bank owned homes. Read the blog now >>
BUT the catch is they only have 2 or so homes available in the Sacramento Area to purchase.
Here is the best part about this program... There are over 250 homes available in the Sacramento area right now that qualify for this program!
Here are some other homes available in the Sacramento Area:
Elk Grove... 46 homes available!
Citrus Heights... 21 homes available
Rancho Cordova... 16 homes available!
Fair Oaks... 4 homes available
Carnichael... 14 homes available!
and so on...
Here is some more specific information about their guidelines:
97% (3% down) for owner occupied financing with NO MORTGAGE INSURANCE!
Why is this such a big deal?
A typical FHA loan with an equivalent down payment (3.5% down) would require 1.75% of the loan amount to be paid upfront for a mortgage insurance premium. Then on top of your monthly payment (PITI), you would be charged .55% (of the loan amount) every year for ongoing mortgage insurance.
Let me break this down so I don't throw too much loan lingo your way.. Here is an example mortgage insurance fees for an FHA loan of $200,000...
$200,000 x 1.75 = $3500 You would be charged this amount at closing or you could roll this into a loan on a traditional FHA loan program for the upfront mortgage insurance premium.
$200,000 x .55 / 12 months = $91.67 This means $91.67 would be added to your payment every month for mortgage insurance.
With this special financing offered by Fannie Mae you could put .5% LESS down than a FHA loan and you do no pay ANY MORTGAGE INSURANCE! This really is a sweet deal!
Do you feel like a little more sugar today? Wait until you see what they will do for an investor!
90% (10% down) for non owner occupied properties with NO MORTGAGE INSURANCE!
If you are looking for an investment home in Sacramento, you know that you will get a better return on your investment if you have less money in the deal. Right now with typical financing (actually offered by Fannie Mae for non-Fannie Mae owned homes), you should expect to put down at least 25%.
Wow! So for example if you purchased a home for $150,000 (not owned by Fannie Mae), you would need to put down $37,500 plus closing costs. If you buy a home owned by Fannie Mae, you only have to put $15,000 plus closing costs. If that does not help you"sharpen your pencil" I am not sure what will! This is a really big deal!
They even offer a renovation program that allows you to finance light renovations upfront and add it to the loan amount. So if you find a Sacramento Fannie Mae owned home that maybe has some vandalism issues (which many do), you can probably get a discount for the home and finance in the repairs that are needed to bring it back to livable condition!
It is so nice to be able to report some good news to folks. It really has been a drag having to shovel through the bad news to try and find something good to report as far as guideline changes go!
Here is a link to search for homes in your area >>
We can offer this special loan program... so just give us a call and we can discuss this opportunity further!
Happy Hunting!
This blog by:
Team Newington
Sacramento Mortgage Planners
(916) 687-6868
www.SuperiorLoanTeam.com
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wow great info. I'm going to check out that link and see what available locally and call some investors!!
Team Newington- Is this just for Sacramento, regional or national? Of course, that is going to give our short sale listings even more competition from foreclosures. URGH! Katerina
Thank you for timely and useful information. I'll look up the properties in my area.
David: It is a smoking deal for investors!
Katerina: It is national! I just tailered the article for my area!
thanks for the information. I think this could help many folks.
You know, many of these homes if purchased with an FHA loan, you can get for $100.00 downpayment.
Team Newington, this is a GREAT program! I heard it was only for foreclosed properties guaranteed by Fannie Mae. Is that true? If so, how do you find out whether or not the home was guaranteed by Fannie Mae?
Join my new AR group and post your blog at http://activerain.com/groups/virtualoffice
Regina P. Brown
This is a good deal. How can we get details to show our clients?
Sounds very interesting.. I had not heard about this one. Thanks for sharing.
I just looked in my area and there are 33 homes in Nashville! I can't wait to look deeper tomorrow. Great post!!
Thanks for this timely information, just checked a town in my area and found 5 properties.
TN,
Thanks 4 the post, I will check this out.
Sean
this sounds like a sweet deal...i'll take 2
I'm not a huge fan of this GSE these days, but perhaps they are getting less greedy and more responsive to everyday folks, we can only hope.
Perhaps this program is a start...
Thanks for the good post on this topic -- appreciate it.
wow, that is huge!!
Just looked in my area and there are only three, but thanks for the great info and the link.
Sounds like some great programs for buyers out there. I wonder if they are doing it our area
Thanks for answering Katrina's question. I was wondering the same as to if it was regional or national. Great info to share with us.
I've seen Homepath listed is some of the Fannie REO's here on island. Sounds more attractive now that I've read your posts.
Aloha from Kauai...
nice! you guys made the front page of active rain. Good info and quite timely.
I am glad you brought this up. I am going to do some research. I am doing a buyers seminar and this is just what I would like to bring up!! Thanks!!
Arise Mortgage: Tell me more about this program!
Regina: My understanding this program is for homes owned by Fannie Mae and are listed on the website.
Chris: You know it is nice that they are working to improve the situation not make it worse!
Not sure how this works in other areas, but the Fannie Mae list agents here are required to put a note in the MLS that this type of financing is offered. It used to be Express Path but they changed to Home Path. Sounds like a great deal!
Hi there,
Great info, just checked out the link myself.
Great Post, thanks for the information.
It's so amazing to me how short it takes for water to find the path of least resistance. Ever notice that? When there's a blockage or dam, water will either use force (as in "the flood gates have burst") or find the path of least resistance, creating an alternative path.
Well, in real estate, particularly real estate financing it didn't take long before the "Loan Modifiers," "Loan Modification Programs," etc. came on scene. Didn't take long at all.
And now I'm reading about the "Renovation Programs" . . .
I'm not sure if I should be amused or in shock. Shocked at all the gloom and doom naysayers . . . because if these programs can get to the market so quickly, what's all the nail biting about!
Happy days are here again . . .
My sister is looking for a home now. I just checked and there is only 1 home in my area but I will keep checking back.
Thanks for the info.
Todd,
That's great news. Slowly, it seems, Fannie Mae and the rest of them are coming to realize that they need to get flexible if they want to dispose of REOs. Buyers should be delighted about this.
This is fantastic. Thanks by the way for including the link to search in other areas.
I saw something about this earlier today and was planning to look into it. Thank you for providing so many details.
Todd - Thanks for the info. This is good news!
How do we find out where to find the list for similar homes in our area? Contra Costa County just to your south.
Thanks for spreading the news about this great loan program! Definitely some great deals out there for the right families!
Great Post! Thanks for the info.
Thanks for the post. Not all the Fannie Mae homes are listed in our MLS, so the link was very helpful.
Thanks for the info! I'm off to check it out.
Great information! You are always providing up to the date information to help agents and buyers! Congrats on making the front page of ActiveRain!
Thank you for the info. I have seen more homes for sale advertising this financing.
Thanks for sharing! This is great information to keep updated on.
NOt a whole lot in my area...but that's okay....good news! I have booked mark the link and will be checking it out!
I get this list emailed weekly (I think). You have given me motivation to dig a little deeper into it and find some gems.
Checked out the Home Path website and it's very interesting! Saw a couple of places I'd consider buying!
Great information. I saw some nice homes in our area, and am going to pass the information along to my potential buyers. Thanks!
Thank you for providing this information and the link. There weren't many in my areas, but I'm hoping to find one for one of my buyers soon.
Team Newington - When I first got wind of this program last week, I ran the numbers and scenarios for a few of my FHA buyers and for my buyers, FHA is still the better option. The main problem I have in putting my FHA clients in this product is that right now FHA rates are much better than the rates for HomePath and even with an FHA 3.5% dp and the FHA MI and UFMIP (financed), FHA was still more affordable for my clients.
However, the biggest advantage of this program will be to the investor, providing of course, there are suitable Fannie Mae properties to purchase. When I checked available properties in Ventura County (SoCA) there weren't a whole lot of available properties and approx 60% of them were concentrated in one specific area.
However, for the investor looking for a deal (who will be a big part of reducing the inventory of REO's in my market), this will be a good product for them.
Wait a minute. Isn't special or creative financing what got us into this real estate crisis in the first place? What about the 12 million households who own more than their homes are worth? These families can't sell without writing a huge check or a short sale, they can't refinance because of low appraise values. This program is only helping the bank get real estate off their books. It KILLS the local market with low appraisals for everyone else.
WAKE UP REALTORS!!! This is just a repackaging of the same programs that have devistated your market for the last two years. Why do you think home prices are continuing to decline?
What are you thinking?
Thanks for the heads up... I am going to see what is available here.
Ann Hayden in soggy Wildwood, Missouri
A very fascinating program. Looks like there is a ton in my area.
Great News, though maybe not so much for me as a non American investor. Certainly will be following this one though as more areas open up with similar deals.
Thanks I will look into this right away
Thanks ..Team, I was able to link to the available listings site and start the process as a vendor from the site you included in the blog. hope to be able to offer Brokerage services soon..again Thanks
Dear Team,
Fantastic info! Thanks so much for your explanation and a link!
I found 3 homes in my area. One was already under contract.
Barbara
Thanks for this info. Great to know.
Donnee: I agree with you. Right now.. it really is more of a benefit to an Investor. Did you know even if your Borrower does not use this financing , they can still get the free home warranty?
Dave: I understand your frustration but I have to disagree with you. Loans are so much different these days. We got into this mess because it was a free-for-all and you only needed a pulse to qualify. Income is being verified along with assets so the Borrower really needs to be solid in order to get into a loan. I do see your point that they are breaking the rules to benefit themselves though. Thanks for your opinion.
Team Newington - thx for the reminder. I think I did read that somewhere in my package of stuff I have on the program.
I just ran across this program on a condo I showed at Mauna Lani Resort on the Big Island of Hawaii. A pretty amazing deal considering that lenders today want 25-30% down on resort properties.