The Fannie Mae HomePath mortgage loan program is one of the hottest loan programs in California right now – mainly because if you are going to buy a home that is owned by Fannie Mae, there really isn’t a better deal on a mortgage.
One of the benefits of the HomePath mortgage is that there is that no appraisal is required by the lender in order to be approved for the loan.
When buying a home from Fannie Mae using a HomePath mortgage loan program, an appraisal is not required. The property value is determined by the sales price.
Even though the property value is determined by the sales price, many people still are getting inspections – and even getting appraisals, even though it is not required by the lender. Fannie Mae agrees is essentially agreeing to loan money on the property in as-is condition, and since they are the seller on these properties, no appraisal is required.
In the event that you want to get an appraisal – lenders have set up some basic rules:
- You must order the appraisal from an appraiser of your choosing – not one that is recommended by the lender. This is key with the new HVCC rules.
- The appraiser must be paid for his services outside of the transaction – it cannot be financed into the loan.
- The lender cannot request a copy of the appraisal. If the borrower provides a copy to the lender, it must be included in the loan file with a note that the appraisal was ordered by the borrower outside of the loan transaction and was not reviewed or approved by the lender.
- The property value reflected in the appraisal will not impact the LTV calculation for the loan.
- The lender must inform the borrower that the purpose of the borrower ordered appraisal and its contents are for the use and information of the borrower only and will not be considered for purposes of the loan transaction.
These rules essentially state: if you order an appraisal, you are on your own and it has nothing to do with the loan itself.
Do people really order appraisals when getting a HomePath mortgage loan? Not that I have seen, but it must happen or we wouldn’t have lenders setting out rules for it!
