Fannie Mae Homepath Program gives first time buyers a 3.5% credit towards closing costs

Credit of 3.5% for First Time Buyers

Fannie Mae just announced on April 11, 2011 that they will give buyers a 3.5% credit towards closing costs on any sales that occur after April 11, 2011. The buyer must close escrow by June 30, 2011 to be eligible for the credit. Also the purchase must be the buyers primary residence. In other words, the buyer cannot be buying his/her second home or an investment property.

First Time Homebuyers
First time home buyers can buy a Fannie Mae REO property with only a 3 % down payment. No PMI or Private Mortgage Insurance is needed. Also, they do not need to get an appraisal on the property. This is a huge issue because many of the deals today fall apart due to apprasal issues (lower appraised value, missing oven/range, fix-it repairs, etc.)

Investors
Investors get a chance to purchase a Fannie Mae property with only 10% down payment. In addition to a lower than normal down payment, the investor doesn't need an appraisal and the investor doesn't pay any Private Mortgage Insurance. Normally, they would be required to get an appraisal and to pay PMI if they do not put at least a 20% downpayment.

This is Fannie Mae's effort to take advantage of low interest rates and sell the vacant foreclosures that are out in the real estate housing market.

If you have any questions about the Homepath program or would like to search for single family homes and condos under the Fannie mae homepath program, please call Daniel Pizano at (408) 460-8401.