Fannie Mae HomePath

Fannie Mae, officially known as the Federal National Mortgage Association, was established in 1938 as a government-sponsored enterprise with the mission of helping lower-to-middle-income families purchase homes. Its success led to its privatization in 1968. Since then, Fannie Mae has introduced the HomePath program, designed to streamline the process of buying foreclosed homes by eliminating traditional intermediaries. This article explores what Fannie Mae HomePath properties are, how they work, and whether they might be the right fit for you.

Fannie Mae HomePath properties are homes that Fannie Mae has acquired through foreclosure. The inventory of these properties is diverse and can include:

• Single-family homes
• Condominiums
• Townhouses
• And more

To explore available properties in your area, visit the HomePath website and enter your area code. Some HomePath properties may require repairs, but many are move-in ready. Fannie Mae often performs basic repairs to ensure that these properties are habitable.

When homeowners either voluntarily relinquish their homes or face foreclosure, Fannie Mae acquires these properties. After possibly making necessary repairs, Fannie Mae lists them on the HomePath website. This platform offers a range of affordable, foreclosed properties with detailed listings and images.
To purchase a HomePath property, you must work with a Fannie Mae-approved real estate agent, who will help arrange viewings and submit offers. Only offers from these approved realtors will be considered.
HomePath properties are typically priced below market value, and with down payments as low as 3%, they are particularly attractive to first-time buyers and those with lower incomes. Additionally, various financial assistance programs are available, which we will explore in the next section.

While conventional mortgages are an option for purchasing HomePath properties, there are specific financing programs designed to facilitate the process:

• HomeReady Mortgage Program: This program is ideal for first-time buyers, low-income families, or those with limited down payments. It offers flexible funding and allows down payments as low as 3%, provided buyers complete a Framework Homeownership course.
• HomePath Ready Buyer Program: In partnership with Framework, this program provides up to 3% in closing cost assistance if at least one household member completes the HomePath Ready Buyer course. Although this is not a mortgage itself, it can significantly help with closing costs.

Before diving into a HomePath purchase, consider the following pros and cons:
Pros:

• Generally more affordable properties
• Potential for financial assistance
• Opportunity for non-residents to co-sign as guarantors
• Suitable for individuals with lower credit scores

Cons:

• Properties are typically sold “as is,” with no option for contingencies
• Limited property options may be available
• Must purchase through a Fannie Mae-approved real estate agent

The process for purchasing a HomePath property involves several key steps:

• Obtain a Mortgage Quote: Start by getting a quote from a mortgage lender.
• Get Pre-approval: Secure a pre-approval letter from your mortgage lender.
• Find an Approved Real Estate Agent: Work with a Fannie Mae-approved real estate agent.
• Search for Properties: Use the HomePath website to find properties that fit your criteria.
• Complete the Buyer Education Course: For certain programs, complete the required buyer education course.
• Submit Your Offer: Once you find a property you like, submit your offer through your real estate agent.