Fannie Mae Offers FirstTime Home Buyers Big Help With Closing Costs

Dated: 04/21/2015

Views: 674


Image title


If you’re a first-time home buyer just entering the market, you’re in for a springtime treat: Fannie Mae will now pay your closing costs, up to 3% of the price of the home—provided you take the mortgage giant’s home-buyer counseling course first.

The new HomePath Ready Buyer program, announced on Wednesday, allows first-time buyers (defined as those who have not owned a home in the past three years) to take an online course, get certified, and become eligible for what could amount to significant savings. For instance, on a $150,000 home, Fannie Mae could contribute up to $4,500 toward your closing costs—which typically range from 2.5% to 3% of a home’s price—and even reimburse you for the $75 online course.

“This could actually get someone in the game,” said Frank Montro, a Chicago-area real estate broker who specializes in selling rehabbed homes. “This goes straight to the buyer’s needs.”

Montro says first-time home buyers are usually either “cash-poor or credit-poor. They pay their bills on time and they qualify for the mortgage, but they just don’t have the savings.”

By offering closing cost assistance on their properties, Fannie Mae is opening the gates to a pool of people who have largely been left behind in the housing market recovery. Traditionally, first-time buyers have made up about 40% of the market. Last year, they accounted for 33%, according to the National Association of Realtors®.

While this announcement marks the mortgage giant’s latest step in loosening credit availability—it also announced a new 3% down loan program in December—it does so with some strings attached. The closing cost credit applies only to properties in Fannie Mae’s own inventory.

Fannie Mae owns thousands of houses across the country, all seized in foreclosure proceedings, and now the government-backed private corporation is actively trying to unload that inventory. Searching our own site’s listings, we found 7,075 single-family homes listed as Fannie Mae HomePath properties. (Click on the address to see details of the house pictured.)

2646 Orange Grove Trail, Naples, FL   $279,900

This 4-bedroom, 3-bath house with pool qualifies for 3% closing cost credit.

“Depending on the details of the terms, closing costs can also help with down payment,” said Jonathan Smoke, chief economist for realtor.com®. “It reduces the amount that you have to bring to the table.”

Want to Advertise on this Site?

Latest Blog Posts

Zillow Premier Agent News

"Love ‘em or hate em, Zillow is building on a program called Zillow Instant Offers in which sellers upload information about their homes and receive offers from local investors

Read More

Housing Recapitulation By Eric Funk

NJ Housing Recapitulation Explained– April 15th – Eric Funk – Licensed Realtor – 551-587-2359According to a recent housing report listing volume is down over 10% from the last quarter of

Read More

Home Buying Process N Outline To Set Expectations Accurately

Home Buying ProcessI am comfortable that we share the same goals and are dedicated to the same outcome, closing!In our efforts to move forward to this end I have outlined the most common steps in

Read More

CREDIT DOS DONTS DURING THE LOAN PROCESS

Good credit is critical when it comes to obtaining the best interest rates and terms on a mortgage. Here are some credit do's and don'ts when looking for a.

Read More