The Low Down: Comparing FHA to Fannie Mae Homepath Mortgages

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EDITORS NOTE: Fannie Mae is no longer offering the FannieMae HomePath mortgage program. If you are considering buying a Fannie Mae HomePath property (foreclosure that is owned by Fannie Mae) in Washington state, I’m happy to help you. 

If you’re thinking about buying a home with minimum down payment requirements in the greater Seattle area, you may be considering a property that is owned by Fannie Mae and eligible for the Fannie Mae Homepath Mortgage or using an FHA insured loan which most properties qualify for.  When home buyers contact me about a Fannie Mae Homepath mortgage, they often ask how it compares to an FHA insured loan. Both are great programs and the benefits may vary depending on credit score, down payment and the type of property.

Rates quoted are as of 8:45 am on September 13, 2011 and are subject to change and are based on mid-credit scores of 740 or higher and a sales price of $340,000.

For your rate quote with current pricing for homes located in Washington, please click here.

Fannie Mae Homepath. Currently Fannie Mae is offering an incentive to buyers of 3.5% towards their closing cost and prepaids for transactions that close by October 31, 2011 on qualifed Homepath properties.  With this scenario, a 3.5% contribution towards closing cost is generous enough to buy down the mortgage rate with discount points.  Fannie Mae Homepath mortgages do not require appraisals.  Fannie Mae Homepath Mortgages are only avalable on homes designated by Fannie Mae.

FHA. Sellers can contribute towards closing cost and prepaids with an FHA transaction as well as l1ong as it’s agreed to in the purchase and sales agreement. FHA loans are available on most homes that do not exceed loan limits and HUD approved condos. Unlike the Homepath Mortgage, FHA mortgages DO require an appraisal.  FHA mortgages may be assumable to qualified buyers in the future and FHA mortgage insurance will drop off after 60 payments AND the loan reaches 78% loan to value.

Which scenario is best for you depends on your personal financial scenario and goals. I’m pleased that I able to offer both programs to you if you’re considering a home that’s located anywhere in Washington state.

If you have questions about any of these programs or are interested in a mortgage, please contact me.

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