Fannie Mae Incentives - Don't Let Your Buyers Lose Any Credits

Fannie Mae Incentives - Don’t Let Your Buyers Lose Any Credits

In our recent series on Fannie Mae Incentives we have been telling you all about the 3.5% Closing Cost Assistance that Fannie Mae is offering to buyers.  Fannie Mae Incentives Announced - Closing Cost Assistance tells you about the incentive. Fannie Mae HomePathQualified Homes - How Do I Find Them tells you how to find homes that will qualify for the Fannie Mae Incentives and Fannie Mae Incentives - First Look Program tells you how to find homes that are currently being offered to Owner Occupants only.

In this article we would like to highlight an important part of the Fannie Mae Incentive: Not letting your buyer lose any of the potential Closing Cost Assistance they could be getting under this program.

There are lenders and/or loan programs that will not allow some credits.  One in particular is the VA Loan Program.  We recently had a closing with a buyer who was purchasing a HomePath property and qualified for the 3.5% incentive that was being offered for homes that close by June 30th.  The buyers’ closing costs were $1041 and 3.5% of his final sales price was $2100.  Of course since Fannie Mae won’t give a “credit” above your closing cost amount, this buyer qualified for $1041 in Closing Cost Assistance - according to Fannie Mae.  However, unknown to anyone until the HUD statement figures were approved by the lender, the VA Loan Program will not allow closing cost assistance credits in excess of the amount of the original earnest money deposit.  Since the buyers earnest money deposit was only $1000 that is all that the VA Loan Program would allow in credits.  Fortunately for this buyer it was only $41 however, had this been a more expensive home with higher closing cost, they could have had to forfeit hundreds of dollars in credits.

Keep this in mind when you are writing offers that qualify for the 3.5% Fannie Mae Incentive.  You should discuss this with your managing broker to confirm your office policy, however throughout the rest of this promotion, we will be having the buyer make their Earnest Money Deposit in the amount of 3.5% just in case!  

While they may not like writing that higher check in the beginning, when you explain to them that YOU are looking out for THEIR best interests, we are sure they will thank you!

Bill and Cyndi

RELATED ARTICLES YOU MAY HAVE MISSED:

Fannie Mae Incentives - First Look Program

Fannie Mae HomePath Qualified Homes - How Do I Find Them

Fannie Mae Incentives Announced - Closing Cost Assistance

The Foreclosure Process - Cash For Keys