HomePath Mortgages: Products & Benefits

Editor's note: The HomePath Program ended on October 14, 2014.

The original article that explains how HomePath Mortgages worked is archived below.

March 29, 2016 update: Fannie Mae has released exceptions for selling HomePath properties. These exceptions include:

• Allowing a 6% interested party contribution for principal residences greater than 90% LTV.
• Allowing properties with resale restrictions if it is a HomePath property.

Other than these exceptions, all other requirements follow standard Fannie Mae eligibility.

In this article:

• HomePath Mortgage Products
• HomePath Benefits
• HomePath Properties
• HomePath Lenders

HomePath Mortgage Products

HomePath mortgage products are specialty programs offered only on Fannie Mae-owned homes. These properties are foreclosed homes, homes taken back as deed-in-lieu of foreclosure (where the borrower deeds the property back to the investor — Fannie Mae — in return for a release of liability from the mortgage loan) or forfeiture.

The recent housing crisis has dramatically increased the number of properties that Fannie Mae (Federal National Mortgage Association) has taken back, thus prompting Fannie Mae to design a program to help sell the homes.

HomePath Benefits

The HomePath financing programs have several benefits not normally available in a standard purchase transaction:

• Minimum 5 percent down payment on owner-occupied properties (10 percent on second homes and investment properties).
• No private mortgage insurance (PMI) is required.
• No lender-ordered appraisal is required.
• Condo/co-op project approvals may be waived.
• Flexible mortgage types — fixed-rate or adjustable-rate loans.
• For investors, some HomePath lenders allow title to be taken as an LLC.
• For investors, can possibly finance up to 20 properties.

HomePath Properties

HomePath properties are easily identified by the following logos on the property detail page:

The first logo means the property is eligible for the standard HomePath mortgage program described above. The second logo means the property is eligible for the HomePath renovation program, which in addition to the benefits above, also includes the ability to borrow up to 35 percent more than the purchase price (not to exceed $35,000) in order to rehabilitate the property. You can search for eligible HomePath properties on the HomePath website.

HomePath Lenders

Fannie Mae has specified lenders that are approved to originate HomePath loan products, including HomePath renovation loans, throughout the U.S. You can find the current lender list for the normal HomePath loan program here.

The HomePath program gives potential homeowners and investors a unique and economic choice to get a home or an avenue to obtain additional investment properties that would not normally be available.

Need help getting a mortgage? Find a local lender on Zillow who can help.