Here’s some good news: After falling through the floor in the aftermath of the 2008 financial crisis, housing prices are finally enjoying a sustained upswing. According to the CoreLogic Home Price Index, year-over-year home prices rose by an impressive 11.8% in 2013, making it the best year for home price appreciation since 2005. According to the Case-Shiller Home Price Index, the U.S. housing market is “on a roll,” with year-over-year gains of over 20% in some parts of the country. After years of fretting, you may now be sitting on some valuable home equity you didn’t even know you had! The question is, how can you harness that increased equity?
I’ve got some good news and some bad news on the housing front. First, the good news: The market is ticking up and the inventory of foreclosed homes is dwindling. The bad news: For just that reason, Fannie Mae is ending its HomePath program.
Fannie Mae’s HomePath program helps buyers of foreclosed properties get cost-effective mortgages, including cash for repairs and remodeling on homes owned by Fannie Mae. The HomePath program currently offers a number of incentives for home buyers: You can put down as little as 5%, there’s no mortgage insurance requirement, and you don’t have to get an appraisal.
Also to end is Fannie’s HomePath Renovation Mortgage, which allows buyers to borrow extra cash – up to 35% of the purchase price, with a maximum of $35,000 – for light to moderate repairs and updates to a foreclosed property.
You can check out the HomePath program at HomePath.com, but be forewarned that it all comes to an end on October 6, 2014 – so you better act fast if you still want to get in on it!
But don’t be forlorn, as Fannie’s making up for these program withdrawals with a number of financing flexibilities. Fannie Mae will allow interested-party contributions (contributions from the seller, the lender or anyone who stands to benefit from the sale) of up to 6% of the selling price, up from 3%. And, it also now allows properties with Fannie Mae-imposed resale restrictions – restrictions which require a length of time before reselling the property – to qualify for Fannie Mae-backed mortgages.
Quicken Loans offers a wide array of excellent mortgage products designed to fit your needs. Since the HomePath program is coming to an end, we suggest you get in touch with a Quicken Loans Home Loan Expert to find out what option works best for you by visiting QuickenLoans.com or by calling 800-QUICKEN.