Sometimes, here in Phoenix and other parts of the nation, you will come across a house for sale where you will be encouraged to use “Homepath” or “Homesteps.” Let’s look at “Homepath” first. This is a program for homes owned by Fannie Mae. Naturally, they need to shift their inventory, so they’re trying to make the home buying process as streamlined as possible. An appraisal is not required as they supposedly priced the house on the market, though that doesn’t mean you have to offer full price: negotiate. A 3% down payment is common, although the seller can contribute up to 6% of the purchase price toward closing costs. Additionally, investors can purchase 1- or 2-unit buildings with just a 10% down payment.

“Homesteps” is a similar program offered by Freddie Mac for Homes You Own (REO). They are trying to combat the notion that foreclosed homes are dilapidated (they often suffer damage at the hands of spiteful owners) and will slightly rehab a property to improve its chances of sale. Typically, that would include fresh paint, carpet, and in some cases, new appliances.

Finally, you may come across a program, run by non-government lenders, called “Express Path.” Supposedly, they are pre-inspected, pre-assessed, low-closing-cost, ready-to-purchase homes. Of course, all those services are paid at the asking price, there is no free lunch. This allows for quick closure, but for whose benefit? Some processes do not need, and should not, be rushed. Industry fandom for this show appears to be mixed. Remember, a one-stop shop rarely benefits the buyer, as the savings are not passed on, but retained as profit.

Emptor warning!