What Credit Score is Needed for a HomePath Loan?

January 24th, 2012 | Author:

[A] HomePath loan is a line of credit offered through Sallie Mae and available through associated lenders. This loan program is designed to allow those with less than perfect credit to qualify for a home loan, and also obtain reasonable terms of said loan. Only certain homes qualify for this type of loan, generally those that have been foreclosed upon, so it is important that you locate eligible properties in your area.

This loan program allows for people with less than stellar credit qualify for a home loan that they can actually afford. The program requires no home appraisal, no mortgage insurance, and only a small down payment is required. This makes home ownership far more accessible, especially for those who are struggling to improve their credit scores. The HomePath program also provides excellent incentives for investment opportunities as well. One of the biggest perks of this type of loan is less strict requirements for the credit score for a HomePath loan.

You can qualify for a HomePath loan, even with poor credit. People with credit scores as low as 580 have been approved for this type of loan, though the terms of the loan are a bit different when your credit score is this low. Ideally, your credit score for a HomePath loan will be at least 660 (FICO score).

Terms of a HomePath Loan

With a credit score of 660 or higher, you can qualify for a mortgage through an affiliated HomePath lender. With a HomePath loan, you are only required to make a 3% down payment, unless you are purchasing the home for an investment opportunity. Two of the other big perks associated with this type of loan are that there are no mortgage insurance requirements and no home appraisals required.

As noted above, homes that qualify for a HomePath loan are usually those that have been lost due to foreclosure, or “fixer uppers”. There are listings of qualifying properties available through the HomePath website that will allow you to view eligible listings in your area.

HomePath loans can also be used for investment purposes. Many people choose to invest money in real estate, whether to be used as rental property, or to be sold at a later time. To qualify for a HomePath loan as an investor, you need a credit score of at least 700. You are also required to make a 10% down payments as opposed to the 3% needed if the home in question is going to be your primary residence. As with the terms for the residential loan, there are no insurance or appraisals required when securing a loan through this program.

The HomePath loan program is an excellent opportunity for those with less than perfect credit to purchase a home at terms they can afford. With a fair credit rating of at least 660, you can qualify to purchase a house for a minimal down payment, favorable terms, and without as many requirements as there are purchasing a home through a traditional lender. This type of loan is also a great opportunity for those with good credit looking for a solid investment.

Newest Answers

Credit Card Advice for New Graduates

June 26th, 2017 | Author:

[I]f you’ve recently graduated or plan to this summer, you may be planning to enter the world of being an adult. You’ll get a job, maybe an apartment and car, and probably open a bank account if you don’t already have one. You may also decide to get a credit card with your new income. […]

Continue Reading »

3 Reasons to Start Out a Marriage with Good Credit

June 23rd, 2017 | Author:

[W]ith summer comes plans for weddings, big beautiful bouquets, a gorgeous wedding dress, garden ceremony and many other unique plans. Of course, each of these items cost money, which can add up to thousands of dollars. What many couples fail to plan for as they dream of their wedding is how to start out marriage […]

Continue Reading »

Why the Employed Struggle to Survive

June 21st, 2017 | Author:

[E]ven those with full-time jobs often end up struggling to pay their bills and protect their credit rating. They live paycheck to paycheck with barely enough left over to last until the next payday. With reports of the economy improving and a low unemployment rate, this may not make sense. One theory is that shifting […]

Continue Reading »

How to Save Money on Vacation This Summer

June 19th, 2017 | Author:

[P]eople look forward to summertime partially because they have a vacation planned. It’s a chance to get away and take a break from the stresses of life. Unfortunately for those who live on a tight budget, coming back from vacation may be a dose of reality they would just as soon forget. You can imagine […]

Continue Reading »

Financial Steps to Take Before You Graduate

June 16th, 2017 | Author:

[I]f you’re about to graduate college and enter the workforce, you want to start out on the right foot. It’s all too easy to get caught up in the idea of a steady paycheck and make some bad financial decisions. Here are a few things you should do about your finances before you graduate. Think […]

Continue Reading »

How to Sell Stuff to Make Money

June 15th, 2017 | Author:

[Y]ou have a bill to pay and you don’t have the money. Or your car broke down and you don’t have the extra funds to pay for the repair. One way to come up with cash when you need it is to sell something you own. However, it’s not always as easy as it sounds. […]

Continue Reading »

Have You Become a Financial Adult?

June 9th, 2017 | Author:

[A]s a teenager and even college student, you probably had your parents looking out for you. They helped with expenses even if you had a part-time job. Now that you have entered adulthood with a full-time job, you feel like a grownup. But have you grown up financially? You Know How to Budget A person […]

Continue Reading »