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Second home for elderly parents provisions

  I already own a property. I am buying a second property for my parents, it is a Freddy Mac property. My parents are elder, and they get very very low income below poverty line (only my father can work). Their income would not qualify for a mortgage. I looked into the Chase Family Opportunity Mortgage, but this was retired/cancelled back in January. Then, I looked into the Fannie Mae Selling Guide (https://www.fanniemae.com/content/guide/sel102213.pdf), page 269, in which you provide "principal residence" provisions as owner occupant for a second property for elderly parents. But since this is a Freddie Mac property, I cannot use the Fannie Mae provision. I also cannot find any documentation to see whether the same exists for Freddie Mac... Does anyone know? Is there any other provision?
My concern is that I do not want to put my parents are co-borrowers, as this will affect them eligibility to future social helps.
  • February 25 - Miami
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Answers (7)

Best Answer

You are correct, it doesn't matter.  You will need to use a lender that is a direct lender to Fannie Mae, like me and other large banks in order to be able to do this kind of loan.  

  • February 25
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The applicable guidelines are for the loan you get, not for who the seller is. Don't let that Freddie Mac is the seller muddy the waters. Use the Fannie Mae program so that you can get the same pricing as offered on a primary residence.

Andrew seems to be familiar with the program so I'd think that would be  a good place to start.
  • February 25
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Profile picture for mymortgagebrokerjoe
If this is a Freddie Mac property, I assume you mean it is owned by Freddie Mac? If that is the case, then do not try to use or go by Fannie mae guidelines. Freddie mac has a website similar to Fannie Mae's Homepath website called homesteps. it is www.Homesteps.com. I suggest you confirm that freddie mac owns the property on their website for starters. they offer a unique type of loan program that may be an option for you as far as buying a home for your parents. They offer a program that requires no appraisal, no mortgage insurance, and you can buy as an investment property for as little as 10% down (i know you can buy as an investor with 10% down with fannie, i have not confirmed with freddie, I am just making the assumption that you can do the sme because the prgrams are very similar). You may be able to put down as little s 5% in your situation. You need to speak with a homesteps lender in order to verify that along with the remainder of the program guidelines.
  • February 25
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Profile picture for alainz
Hi Andrew, thanks for the reply...
This is regardless the fact that the property was listed in the MLS as a Freddie Mac property?
  • February 25
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You can use this Fannie Mae Program to buy any home for your parents.
  • February 25
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Profile picture for alainz
Also, can you use a Fannie Mae type loan on a MLS property from Freddie Mac?
  • February 25
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I mean, the property is listed in the MLS, and it shows as a Freddie Mac property.
  • February 25
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