HomePath Financing Foreclosures

Wow, what a great option for home financing!   Fannie Mae properties listed on their website www.homepath.com are eligible for HomePath mortgages.  HomePath is offered exclusively to borrowers buying homes from Fannie Mae.  There are options for Primary Residences, Second Homes and Investment properties to include Single Family Residences and Condominiums.   Primary residences require a minimum of 3% down payment, with 10% down payment on Second Homes and Investment properties. 

 A few advantages to mention regarding the benefits of HomePath financing are No PMI (private mortgage insurance), No Appraisal, No Condo Questionnaire, and No need to fix repairs to qualify for financing.

Generally, if the borrower does not have 20% down payment, mortgage insurance would be required.  No mortgage insurance can save a borrower thousands of dollars over the life of the loan. For example, if the mortgage insurance is $100 per month, with a minimum of 5 years to keep on the mortgage, that is $6000 over the life of the loan.  With Homepath financing, mortgage insurance would not be required, thus a huge savings to the borrower. 

There can be many issues with a house appraising.  With HomePath, the sales price is used as the property value.  Fannie Mae has determined the price and the lender will accept that value without an appraisal.

Condominiums do not require a review except to verify that the project is not a Condotel.  This would avoid the need for a condo questionnaire to be completed.  The information contained on the condo questionnaire may make a condo ineligible for financing under normal conventional financing.    With HomePath, that would not be an issue.  Another great advantage is that some lenders have no additional LTV limits that would apply to Florida properties. 

A Fannie Mae-owned house or condominium may need repairs but would not be able to be completed prior to purchase. By applying for a HomePath mortgage, which doesn't require a property inspection or appraisal, the borrower would be able to finance the property and make the repairs after closing.  HomePath allows for 6% seller contributions for Primary and Second Homes, and 2% seller contributions for Investment Property. This could allow the borrower to keep more of their closing costs money in their own pocket to complete the repairs needed after closing. 

Happy to answer your questions on HomePath Financing.

Dawn M. Houser Senior Mortgage Banker

Phone:  239-464-9455   / Fax:  866-686-5382  / Email:  Dawn.Houser@aemc.cc

 

 

Why You Should Buy a Rental Property…

I came across this post, Why You Should Buy a Rental Property and when I read, “The best investments we’ve made are the ones no one else would touch.” I can see why David Ackman is hot on the Single Family Home Rental Property.  “They are cheap,” he says.  “They are a buy.” All I have to say is I agree 100%, properties are cheap in many areas of Brevard County as well as the entire state of Florida.

Now is the time for investors to scoop up these properties priced drastically below market value. My long time experience as a property manager not only helps investors determine where to buy for the best rate of return, but I am also able to provide the services of managing properties and help protect their values. By conducting regular inspections, my team and I are able to determine if the property is being maintained and to check for issues tenants may not even realize are problems.

With all of the short sales and foreclosures there is a growing need for rental properties. People coming out of distressed sales need a place to live. Most of these people make excellent tenants, they’re just victims of the economic disaster.

Why should you buy a rental property? Because the time is ripe to buy not one, but maybe two or three rental properties. When the market rallies back to stability selling them should produce a very nice profit.

 

Link to the article:

http://www.noradarealestate.com/blog/why-you-should-buy-a-rental-property/

 


PEEKABO APPLICANTS

There are five tenants applying for your home that you placed on the market (meaning, you put a craigslist ad in your area).  Four of them look ok, steady jobs, good and stable rental history for the past few years and they all have verifiable jobs.  The last applicant doesn’t list the previous landlord’s physical address, phone number or email address, nor do they list employers, stating ‘self-employment’. 

     What do you do?  Your suspicions raise red flags so you fire up your trusty desktop computer, head to some online background verification websites and plug in that last applicant’s name and social security number.  You want to find out if there is any criminal background activity or if they are house jumping to avoid paying deposits or rent and the big one, were they foreclosed on?  But, is what you’re doing ethical and/or legal?

     Well, the problem is that unless you check the public records of every applicant in a given similar situation, you may run afoul of fair housing laws, as you may not be treating all the applicants equally. You need to create a written plan and a policy which will determine under what circumstances you will check the public records and how far you will go with this. As part of this decision and plan, you will need to determine what counties you will check, and understand that in some counties, the information is not readily available and would require written requests or payment for information.

     In the event of foreclosure, there are two story versions. The first version is where the applicant tells you that she was living in a home, and the owner of the home got foreclosed on, forcing her to move. The other story is the applicant was the actual owner of a single family home, was foreclosed on and had to move.  If the applicant was the tenant who “supposedly” had to move, you need to verify this. You MUST verify the story, and all you need to do is look at the public records, put in the owner’s name in the civil court records to find the foreclosure, or put in the property address in the tax appraiser’s records and begin to dig. If the owner was truly foreclosed upon, you will find that information in the court records.