Financing in Goodyear>Question Details

Darlena, Home Owner in Goodyear, AZ

How does Fannie Mae/ Homepath financing work?

Asked by Darlena, Goodyear, AZ Sat Feb 26, 2011

Can I use it to purchase a rental home? Have credit score 0f 720!

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Though I do nto deal with that area...Here is my take on Home path financing. I deal with a lot of buyers who purchase through fannie mae and use homepath. I think it is a great program.

it works similiar to an FHA loan. the down payemnt is minimal. In your case becuase you are buying it as an investment proerty; they will require 10% down payment. But, you do not pay any mortgage insurance. that is an insurance a bank charges you when the down payment is less than 20% to protect their interest in the house. Depending on the price of the hosue it can range form $40.00 to over a $100.00 a month on your monthly payment for a set period.

The second beneift is you do not need an appraisal. Fannie mae has had the house appraised and valued. they knwo the condition of the home and upon an agreeable price is goign to back the loan for the bank. Thus you save anywhere form $350.00 to $450.00 for an appraisal.

The third is you cna have a debt to income ratio of up to 50%. This means that your total current monthly debt obligations. (including your mortgage on the new house, current mortgage, any car payments and credit card debt ) cannot exceed 50% of your total gross monthly income.

The fourth criteria is you must have a credit score of at least 660. based on what you wrote you are fine with that.

the interest rate is slightly higher than a conventional mortgage but the payment will be less. You are not paying mortgage insurance and thus your paymet twill be smaller each month. Check with your local lender to see if they participate in the program. Most do, but not all.
Web Reference:
1 vote Thank Flag Link Sun Feb 27, 2011
You should speak with a HomePath lender. Short answer is yes, you can. HomePath numbers:
- 660 minimum credit score
- No MI
- No appraisal
- Max LTV = 95%
- Max dept-to-income = 50%

Last item is key. HP prefers owner-occupied. Just wrapped an investment deal where seller financed w/ HP.

Good luck!
Web Reference:
1 vote Thank Flag Link Sat Feb 26, 2011
All good advice - I can finance HomePath, HomeStyle as well as HUD REO homes - please let me know if I could be of help.

0 votes Thank Flag Link Thu Mar 10, 2011
Please speak with an experienced lender, one that has worked HomePath before. Best of luck.
0 votes Thank Flag Link Sun Feb 27, 2011
Your mortgage broker can assist you with all these questions. High credit score 720 is a start, however many more questions require answers

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
0 votes Thank Flag Link Sat Feb 26, 2011
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