“On October 7, 2014, Fannie Mae will remove the HomePath Mortgage and HomePath Renovation Mortgage logos from properties listed on HomePath.com, and Fannie Mae REO properties will no longer be listed as eligible for HomePath Mortgage/HomePath Renovation Mortgage financing. We are making corresponding changes to the requirements applicable to delivery of HomePath and HomePath Renovation Mortgages under the subject Variance. The Variance will be modified to reflect the following requirements for delivery of HomePath and HomePath Renovation Mortgages on or after October 7, 2014:
(a) The lender must have an executed purchase contract for the sale of the related property that is dated on or before October 6, 2014;
(b) The lender must document the loan file with a copy of the property’s “Listing Details” page printed from http://www.homepath.com on or before October 6, 2014, showing the HomePath Mortgage and/or HomePath Renovation Mortgage logo, indicating the property’s eligibility for HomePath Mortgage and/or HomePath
Renovation Mortgage financing. The Real Estate Purchase Addendum reflecting the selection of HomePath Mortgage or HomePath Renovation Mortgage financing may be used as a substitute for the printed “Listing Details” page showing the logo, if it is dated on/or before October 6, 2014; and
(c) HomePath Mortgage/HomePath Renovation Mortgages meeting the above requirements that are sold as whole loans must be purchased by Fannie Mae on or before March 31, 2015 and loans delivered for MBS must be in pools with issue dates on or before March 1, 2015(this impacts lenders only).”
The letter also explained, “Fannie Mae will update the Selling Guide at a later date to offer some flexibility for financing the purchase of Fannie Mae REO properties.”
At First Home Mortgage, we are removing the product as of tomorrow, Friday, September 12th. Any loans in progress must be locked in by tomorrow, and we will not take any new HomePath applications. If you are counting on HomePath financing for a home in the next couple of weeks, touch base with your lender to make sure the proper steps are being taken to meet the above criteria.
New “Financing Flexibilities” to Replace the HomePath Mortgage
Even though the HomePath mortgage program is being retired, Fannie Mae will still be offering some of its features to borrowers purchasing Fannie Mae REO (foreclosure) properties. Below is an overview of the “Financing Flexibilities” announced on their fact sheet:
- Interested Party Contributions (IPCs): For principal residences with LTV/CLTVs greater than 90%,
Fannie Mae allows up to 6% interested party contributions (rather than the 3% standard per the Selling
- Multiple Financed Properties: For borrowers owning 5–10 financed properties, a maximum
LTV/CLTV ratio of 75% for 2-4 unit investment properties is permitted (rather than the standard 70%
per the Selling Guide) on fixed rate mortgage transactions only. LTV/CLTV ratio limits for ARM
transactions and High Balance Loans are per the Selling Guide. All other eligibility requirements for
borrowers with Multiple Financed Properties continue to apply.
- Resale Restrictions: In the event the mortgaged property is subject to any resale restriction imposed
by Fannie Mae as the property seller, the mortgage is eligible for sale to Fannie Mae, notwithstanding
any Selling Guide restrictions on properties subject to resale restrictions.
To view Fannie Mae’s HomePath properties, click here.
If you have questions about this topic or any other mortgage topics, feel free to email me at email@example.com or call me at 804.386.9364.