To spark more interest in its massive holdings of foreclosed properties, Fannie Mae is offering to cover up to 3.5% of closings for homeowners who can close by June 30.

“Fannie Mae wants to help more buyers afford to purchase their new home.  That is why we are offering up to 3.5% in closing cost assistance for HomePath properties,” the GSE said on Twitter.

Through its HomePath program, Fannie provides low-downpayment financing on sales of REO properties with no requirements for mortgage insurance or appraisals. 

Fannie offered closing cost assistance during the fourth quarter of last year for the first time, but the GSE said it still ended up with an inventory of nearly 162,500 REO properties as of December 31.

In the fourth quarter, Fannie recouped 55% of the unpaid principal balance on the defaulted mortgages through the REO sales.

Fannie sells most its REO properties through HomePath, which also provides financing for second homes and investment properties. 

Buyers receiving closing cost assistance must certify that they will be owner occupants.

Daily Briefing | Wednesday, April 13, 2011

• Feds Unveil Consent Orders Against Nation’s Megaservicers — Plus Vendors LPS and MERS

  Federal banking regulators Wednesday afternoon dropped their regulatory “bomb” on the nation’s largest residential servicers — and two of their top outside vendors — accusing the firms of a “pattern of negligence and misconduct” tied to the processing of loans.

• JPM’s Mortgage Revenue Hammered in 1Q, CO About to be Sent

  JPMorgan Chase saw its mortgage-related revenue get hammered in the first quarter, falling a stunning 75% to $696 million (compared to 4Q), as originations declined and the firm focused resources on its massive servicing portfolio and dealing with legal issues tied to that business.

• JPM Mortgage Originations, Credit Losses Drop in 1Q

  Mortgage originations at JPMorgan Chase dropped 29% since the end of 2010, kicking off a year where industrywide originations are projected to drop below $1 trillion.

• CoreLogic’s New Outlook for Home Values Isn’t Exactly Pretty

  Sales of distressed properties could pull home prices down by another 10%, according to CoreLogic chief economist Mark Fleming.

• FRM Rate Rises and Apps Decline

  Mortgage application volume decreased by 6.7% on a seasonally adjusted basis for the week ended April 8 as the average rate for the 30-year fixed-rate mortgage rose for the fourth consecutive week, according to the Mortgage Bankers Association.

• Bank Branches Producing Fewer Mortgages

  A growing share of loans originated by banks are coming through their wholesale/correspondent channel, according to the American Bankers Association’s annual real estate lending survey.

• Sandler O’Neill Adds MBS/Fixed-Income Managing Directors

  Sandler O’Neill is adding two managing directors as well as three new sales professionals to its Chicago-based fixed-income group as part of an effort to strengthen its growing new-issue distribution of MBS and other fixed-income products.

• South Florida Foreclosures Decline but Not By Much

  For the first time in four years, the number of foreclosures has fallen in the tri-county South Florida region, according to the latest report by CondoVultures.

• Iowa AG Blasts Bank-Funded Servicer Settlement Study

  Iowa Attorney General Tom Miller blasted a study Tuesday that said proposed servicer settlement terms could cost the economy $10 billion a year.

• Georgia Leaves Fraud’s Top Ten List

  For the first time in 13 years, Georgia won’t be among the top ten states for mortgage fraud when LexisNexis releases its annual MARI fraud index on May 2.

• Canada’s Davis + Henderson Floats New Shares To Fund Mortgagebot Deal

  Davis + Henderson, Toronto, said it raised $122 million in a secondary share offering, which the financial services firm used to finance its acquisition of online mortgage origination provider Mortgagebot.

• REO Allegiance Gets Field Services Contract

  REO Allegiance has been selected by 24 Asset Management Corp. to conduct property preservation and field services.