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10% Down Payment Investment Property Purchases

Friday, August 5, 2011 - Article by: Lender411 Member

The stock market is a wild ride roller coaster ride lately and has many investors nervous about where should they put their money. Money Market's and Cd's are safe but you are only making 1%.right now. So many Americans are looking for a place to investment their money.

The great opportunity is in real estate right now. Home values are low and mortgage rates are still at all-time lows. It's a great time to buy investment property now. Buy low today with as little as 10% down payments then collect your rents and sell when the values increase down the road.

Fannie Mae has a program called Homeopath. The Fannie Mae Homeopath product is strictly for properties that Fannie Mae has foreclosed on and is now selling. As an investor you can buy a Single Family House or Townhouse with only 10% down payment. Another advantage to this product is that there isn't any PMI (private mortgage insurance) on the loan.

You can view the Fannie Mae owned properties at . You can sort the properties by state, zip code, city, property type, sales on the website. Then go out and get yourself pre-approved for a mortgage with a Fannie Mae Home Path approved mortgage lender. Once pre-approved have a licensed realtor show you the properties that you are interested in. Find the property that you like and have your realtor make your offer to purchase. Please note that you will need a pre-approval letter to make your offer on this property.

Some of the basic guidelines to this product are as follows:

1. All Borrowers need a min. middle credit score of 660.
2. Max. Debt to income Ratio is 45%
3. Max. seller paid closing costs are 2% of purchase price
4. No Appraisal is required on the property for this program
5. Min. of 6 months PITI reserves.
6. Down Payment & Reserves can't be a gift.
7. Since no appraisal is required a copy of an executed lease is required if you are needing the rent to offset the new mortgage payment.
8. IF you don't have 2 years prior landlord history you must qualify for the full mortgage payment without an offset of the future rental income.
9. These are just some of the basic guidelines, please contact a licensed mortgage professional to get pre-qualified for a purchase.

I will be closing one of these next week for a borrower and his rate is 4.75 30 Year Fixed with standard closing costs, plus a 1.5 discount point.

You will be amazed at some of the great prices on the properties and what great condtiion they are in.

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