Kris,

When I checked and compared it to FHA it was between 1.00% to 1.25% higher on the rate plus the closing costs were at least 1% higher.

Chrissy,

The homepath program is available for investors. It however is not a renovation loan program, they will not pay for renovations to be financed into the home. The down payment requirement for an investor is 10% down and they waive the mortgage insurance requirement. Also, if the home is being purchased as a 2nd home, it also requires 10% down.

Kelly,

Let me try to help with any clarification I can give.

Both the Fannie Mae Home Path program and FHA both allow a seller to contribute 6% toward the buyers closing costs and pre-paid expenses. Depending on your market you can ask for closing costs to be negotiated into the offer in your contract. So in your case, since the purchase price is $200,000.00 you could ask for up to $12,000.00 for closing costs. Remember both the Fannie Mae Home Path program and FHA will allow this with their financing. Also, please note by my example in the post, that most of the time FHA will be the cheaper option for the home buyer if it is your primary residence. This is because the home path rate is not as competitive as FHA rates. You also asked further if asking for closing costs to be paid by seller/bank is a standard request. That really just depends on the situation. In our real estate market here in Phoenix it is very common for buyers to ask for closing costs to be paid for by the seller, but this can vary from market to market. Also, it also depends on other factors such as how long this home has been on the market and is the seller getting mutiple offers on the property. I have always found that a buyer can always ask, the worst thing is the seller rejects your offer. I would lean on your real estate agent for advice on this.

If you have further questions, I will be available today at (480) 251-0002 for questions.

Mia,

You can use FHA financing on a Fannie Mae property. Some of the Fannie Mae properties are also set up through Fannie Mae to use Homepath financing. Either one is acceptable.

Thank you again for your comment.

Kimberly,

Normally I can answer someones question pretty straight forward, but in your case, it is hard to advise you on the best decision when I do not know really any of your specifics. Also it is common for silent 2nd mortgages to have issues with the 1st mortgage financed. If your current lender is trustworthy and not trying to steer you wrong, then I would take his advice. But again each borrower’s situation is very unique. I do want to make it clear that you do want to take advantage of the low rates. Who knows if 5 year or 10 years interest rates will ever be this cheap.

Dear Tonya,

I have had this situation come up before and let me share what I know. Underwriters and investors are not understanding why your mother would travel 170 miles each way, which is about a 3 hour commute each way back and forth to work each day. So requiring a letter of explanation is a normal logical requirement. As a loan officer, I would also question this because it is not logical. An underwriter has no way or knowing if your mother is being truthful or not. All an underwriter can do is make a judgement call that your mother is being truthful about her situation based on the evidence presented. You also stated that she plans to commute until she transfers or retires, so an underwriter asking for a location of a employment address closer to her home for verification purposes is again normal and necessary. Now you state that the 2nd part isn’t going to happen, but without this an underwriter has no way of knowing if a closer office truly exists. Understand the underwriters point of view, your mother is asking the bank to believe that she is going to travel 170 miles each way to work. If they are going to believe this, they need some evidence to back up your mother’s claims. I think the best way to get this condition satisfied is to be honest and forthcoming with the bank. Provide them the information about the closer office, provide them the letter of explanation. I do feel that this would be a deal-breaker with just about any lender out there based on the way you are trying to structure the loan. Before I responded, I personally called my head underwriter and went over your situation. He stated that he usually can get the end investor to sign off on a file when the commute is less than 90 miles each way. Further than that, he states that the story starts to sound not believable even if it is. They are 100% afraid that she is lying and this is why they are making it difficult. If I did this loan for you, I would run into the same situation most likely. Now I pose the question of why your mother does not treat this as a 2nd home and put 10% down. That would be more believable to the underwriter to get the file approved. No one is calling your mother a liar, they are just trying to back up her claims with the evidence given. I wish you the best.

Dear Diana,

I cannot give you advice on this, because this is not a finance issue, but a contract issue. You must discuss this with your real estate agent. Now let me try to share what I can to be helpful. I have never heard of the Fannie Mae First Look Initiative, so why the seller is countering your offer I am not sure. Now, you have the right as a buyer to make it clear to your agent that you need to go homepath and that is final. You and your husband have the right to choose your financing, this is not a seller choice, but your one, they (the seller) cannot force you to change your financing, now if they choose not to accept the offer, then shame on them. You also cannot agree to this Fannie Mae First Look because then you and your husband would be possibly be committing loan fraud for stating that you would be owner occupying the property, which cannot be backed up on your loan approval based on your husband’s telecommute issues. If I was in your situation, I would counter back that you must finance using homepath and that is final. If you do not get the home, then it was not meant to be, but at least you were being honest. If a seller is this ignorant that they know your finance options for you better than yourself and will not agree, then you need to let it go and find another property with a seller that is more willing to work with you. I see this type of behavior from seller/fannie mae all the time. You just need to hold your ground. Good Luck, I wish you the best.