Sometimes foreclosures happen and Fannie Mae needs to take possession of a home from a distressed borrower. When that happens, they try to sell the home as quickly as possible to limit the damage it causes to the surrounding homes due to the falling value a foreclosure can cause. In order to do this, they offer the Fannie Mae HomePath program.
The HomePath program helps match new homebuyers with the homes Fannie Mae has taken possession of. Fannie Mae has possession of many types of homes including single-family, condos, townhomes, and multi-unit homes across the country. Not all homes are ‘run down,’ many are in perfectly good condition; their owners just couldn’t keep up with the payments.
Finding HomePath Properties
Finding HomePath properties is as easy as visiting www.homepath.com and searching by any of the following information:
- Street address
- City, state
- Zip code
- Price range
- Number of rooms
- Type of home
You can also use the map and zoom in on areas with Fannie Mae homes for sale.
Once you find a home that you want to purchase, you’ll have to make an offer.
Making an Offer on a HomePath Home
You’ll need a licensed real estate agent to make a bid on the Fannie Mae HomePath home for you. Individual buyers cannot make bids for themselves. Keep in mind, if you are not buying the home for owner occupancy, you may have to wait until the ‘First Look’ period ends. The ‘First Look’ period is when only borrowers that will live in the property can bid on it. Fannie Mae usually reserves the first 15 days of the listing for this purpose. This gives the home the chance to have people living in it right away and decreases the risk of it sitting vacant and further damaging the values of the surrounding properties.
If you are an investor or buying the home for any purpose other than living in it, you may have to wait until the period ends. A real estate agent can let you know when this is the case.
Understanding the Home’s Condition
Before you purchase the property, you should be aware of its potential condition. Generally, Fannie Mae does not make any repairs to the home. They may make some small repairs if they think it will affect the home’s marketability. In most cases, though, you’ll find it in ‘as is’ condition. Once you close on the home, the repairs are your responsibility.
Fannie Mae suggests that you hire an inspector to ensure that you understand the condition of the property. Making an informed purchase decision can help you determine if this is the right home for you or not. It would be difficult to move in and find out the home needs thousands of dollars in repairs if you don’t have that kind of money lying around.
Purchase Contract Contingencies
Unlike when you purchase a home directly from the owner, Fannie Mae will not allow you to include contingencies in your purchase contract. The most common and important contingency borrowers often want is the housing contingency. They want to be able to sell their home before closing on the new purchase. If they don’t sell the home, they then reserve the right to back out of the contract. Fannie Mae does not allow this benefit, which may make it harder to buy the property if you have a home to sell.
The remaining part of the purchase process works just like any other home purchase. You have to secure financing and close on the loan. Fannie Mae allows you to use any title company and/or lender that suits your needs. Fannie Mae does offer a few benefits along the way, such as lower down payment requirements and help with closing costs in exchange for taking an online course.
The best way to purchase a Fannie Mae HomePath property is to start by finding a real estate agent with experience with the program. This way you know you are in good hands, as you navigate the process and try to buy a foreclosed home at a decent price.Click to See the Latest Mortgage Rates»