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Home Path Mortgage

Home Path Mortgage is a special home buying option available through Fannie Mae. Multiple incentives are available to entice buyers to purchase Fannie Mae properties including reduced down payment requirements and closing costs, flexible mortgage terms and elimination of mortgage insurance and home appraisal fees.

Two types of Home Path mortgage financing options are available. HomePath mortgage financing is available to buyers purchasing a Fannie Mae home as their primary residence. HomePath renovation mortgage financing provides funds to purchase a Fannie Mae home and make light renovations. Both options require buyers to obtain mortgage financing through an approved Home Path lender, which can be located at

Properties offered through Home Path include single family homes, townhouses and condominiums. These properties are owned by Fannie Mae and acquired through bank repossession, deed in lieu of foreclosure and forfeiture; meaning homeowners walked away from their home without filing appropriate documents releasing them from the property.

Fannie Mae homes are sold in as-is condition and buyers should obtain a professional home inspection prior to making an offer. It is important to note not all Fannie Mae homes are eligible for special financing. Only properties listed at the website qualify.

Buyers with less-than-perfect credit and those who do not have the financial means to contribute a large down payment might qualify for Home Path mortgage financing. Buyers of Fannie Mae REO homes are required to provide a minimum 3-percent down payment. However, under the Home Path mortgage loan program borrowers are allowed to use funds obtained through monetary gifts, grants, or loans provided through state or local government agencies, non-profit organizations, or employers.

One source for obtaining grant money to purchase bank owned homes is the Department of Housing and Urban Development. Billions of dollars have been set aside for HUDs Neighborhood Stabilization Program Grants; a program developed to stabilize communities that have been hit hard by foreclosure.

NSP grant funds can be used to purchase Fannie Mae properties through the Home Path mortgage loan program. NSP funding is overseen by various nationwide partners. Borrowers must contact the program manager in charge of their state or county program. A list of NSP grant partners is available at

Buyers are required to be prequalified prior to placing a bid on Fannie Mae properties. Prequalification is a process used to determine how much money borrowers qualify for and does not guarantee financing will be approved.

Fannie Mae home path properties are eligible for the $8000 tax credit for first time home buyers. Additionally, a $6500 tax credit is available to homeowners who have resided in their home for at least five years but want to relocate to a new home. At present, first time home buyer programs and tax credit incentives are set to expire on April 30, 2010.

Last, but not least investors can take advantage of discounted properties offered through Fannie Mae Home Path mortgage program. Fannie Mae homes are sold under the "First Look" provision which means buyers utilizing public funds have first dibs on the property during the first 15 days the property is listed. If no offers are presented during this timeframe, real estate investors can submit their offer through a Fannie Mae listing broker.

We invite you to learn more about buying houses, financing options, REO and foreclosure properties, and first time home buyer programs by perusing our homeownership article library. New articles are published on a weekly basis, so take a moment to subscribe to our mailing list and receive real-time update notifications.