Freddie mac homesteps first look program
There are some distinct differences between a traditional home purchase and that of a Freddie Mac, HomeSteps Home. Below you will find the most commonly asked questions home buyers like yourself will need to know and understand before you begin the home search.
- Freddie Mac Q&A?
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- Using HomeStep Financing?
Can I do a home inspection on a Freddie Mac home I am considering purchasing? In most Freddie Mac transactions, the buyer is allowed to conduct all customary inspections within a specific inspection contingency timeline. In traditional purchases, the contract allows for a 10day home inspection. In most cases, this rule will apply with Freddie Mac homes, unless something else is agreed to during the negotiations. Just like a traditional sale the 10day inspection period begins when the seller Freddie Mac signs the contract.
Although this is usually the normal procedure for Freddie Mac properties, you still want to read the fine print to verify before you assume you have 10 days to conduct your inspections. Because the home has never been occupied by the current owner, in this case Freddie Mac, they can not provide you with the customary disclosures you would receive if you purchased a home from Mr.
Find a Home During First Look
Nor will there be any disclosures about the property condition made by the current seller Freddie Mac. If your appraiser finds repairs that must be done as a condition for your loan to be approved, then you will need to contact the listing agent right away. Freddie Mac will require a copy of the appraisal and it will depend on the type of repairs and the cost to complete the repairs before Freddie Mac will agree to do any work to the house.
If there are minor repairs Freddie Mac may be more inclined to agree, however, keep in mind, this case-by-case and could vary from property to property. Freddie Mac requires that all properties be on the market a minimum of 15 days before they will consider any offers from non-owner occupant purchasers. A non-owner occupant by definition is a purchaser who does not plan to occupy the property as their full time, primary residence.
This includes second home buyers, any trust purchases, special entities who will hold title and all investors.
If you are an owner occupant, there is no restriction on when you can make offer. Yes, all Freddie Mac properties will require you, as the buyer, to sign their purchase addendums. This document does not replace the Arizona Department of Real Estate purchase agreement, however, it can alter or change the terms of your original offer. When your offer is accepted and terms have been agreed to, Freddie Mac will send you or your real estate consultant the bank addendums to sign.
This document will reflect all the terms you have agreed to. Make sure you read this document and proof for any inaccuracies or spelling mistakes. If you are asking for any special concessions or closing costs, please make sure you read section 31 of the Freddie Mac addendum thoroughly. If you find there are mistakes, then you need to address them with the listing agent right away. Any changes must be made now, not during the escrow period. In most cases, the sooner you sign and return the bank addendums to the listing agent, the better.
The listing agent should give you a deadline in their instructions; however, a good rule of thumb is no later than 24 hours. If you are unable to meet the deadline for some reason, make sure you tell the listing agent. Otherwise, Freddie Mac has the right to cancel the offer and move onto the next buyer. Freddie Mac has implemented a form called an Owner Occupant Certification to ensure proper handling of purchases by non-owner occupants.
This form is to help prevent fraudulent transactions where a buyer may say they plan to occupy the property but really have no intention of living there as their primary residence. Freddie Mac normally grants a 30 day closing for cash offers, 60 days for all financing offers and up to 90 days for FHA K type rehab loans. If you require an extension during the escrow process, make sure you ask for it before your scheduled closing date.
Freddie Mac understands that things happen during the process which can cause a delay. However, repeated extension requests can cause an issue and the asset manager will elect to charge you the per-diem if they wish. Talk to your loan officer prior to agreeing to a closing date in writing to make sure they can get the loan paperwork completed in the time allowed. If you or your real estate consultant have submitted an offer with all the proper documentation as required by the listing agent, most offers will be responded to within 48 hours.
If you or your real estate consultant fail to follow the instructions given by the listing agent, this could prevent your offer from being submitted to Freddie Mac in a timely manner. There are specific details the listing agent must know about you as the buyer before they can submit your offer.
MANAGING YOUR MONEY
You need to be prepared to answer the following questions when submitting an offer on a Freddie Mac home: 1. Are you a first time home buyer? Are you the previous lender or relative of the previous owner? If you are purchasing as an investment, and title will not be held in your name, you must provide the name of the authorized signer.
4 Tips for Buyers Using Freddie Mac’s HomeSteps Program
Freddie Mac will never counter your offer in writing. This is vastly different than a traditional purchase. If multiple offers are received, it could take several days before you hear a response back. If anything should happen to the accepted offer, your offer could move into first position.
Your real estate consultant can guide you through this process. It is important to know that when Freddie Mac counters an offer in their online system also known as a portal they will not look at any other offers until that buyer has had a fair chance to review the terms of the counter and make a decision. If the buyer counters the counter or rejects, then Freddie Mac will open the negotiations back up to all interested parties.
Legal acceptance occurs only when the contract is signed around by all parties, and that can take five to seven days. If there are multiple bids, all candidates will be given a deadline to submit their best offer. That means working with a reputable agent who knows the area well. This is verification from your lender that it has reviewed and approved your loan file. At that point, all you need is a property. Keep in mind that some first-time buyer mortgage programs, like Home Possible Advantage, require buyers to complete a home buyer education class.
Freddie recommends commissioning a home inspection from a licensed provider. It will probably be in decent repair. You may get it for less than market value, and you will get a home warranty incentive. HomeSteps financing, where available, comes with a low down payment and no mortgage insurance.
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- First Look Eligibility and Identification.
Enter a city, state, or zip code into the HomeSteps search tool. There may be no homes available in your area, but keep checking, as additional properties may be added. Not usually. The benefit of HomeSteps, however, is that you do not have to compete with cash buyers or investors for the first 20 days the property is listed. You also get a home warranty, and potentially, access to special financing. Also, the homes are cleaned up and maintained which reduces repair costs after purchase. However, the day First Look period must pass. During this initial time frame, only buyers who plan to live in the property may make an offer.
After that, you can buy the home for any purpose, but will be competing with all buyers. A select group of participating lenders accept HomeSteps financing applications. No appraisal is required, which eliminates the risk of loan denial due to property condition. According to Freddie Mac, all offers must include a sales contract, pre-approval letter, earnest money, and HomeSteps-specific sales contract paperwork. Your chosen real estate agent will facilitate all aspects of the offer process. HomeSteps is a powerful program that helps communities and home buyers.
Freddie Mac HomeSteps Program - 4 Tips for Homebuyers (Updated) - SmartAsset
Mortgage rates are ultra-low, and it could be the perfect time to secure a low payment. The HomeSteps program helps buyers get into a home at a low upfront and monthly cost. Get a quote for your home purchase, and see how much you can qualify for. No social security number is required to start, and all quotes come with access to your live credit scores.