Fannie Mae offers temporary cash incentives to potential homebuyers

Fannie Mae, the leading mortgage investor in the United States, is offering cash incentives to the tune of 3.5 percent of the purchase price to qualified homebuyers in the hopes of trimming down its stock of foreclosure homes.

A report in Los Angeles Times says the company has a hold on as many as 31,000 houses through foreclosures across the nation that its looking to get rid of.

Those interested in seizing upon the deal should submit their initial offers by March 31 and close the deals by May 31. The deal is not open to investors.

The available houses offer a wide range of prices, locations and sizes, including one-bedroom condos to four-bedroom, four-bathroom residences.

The website lists about 4,360 homes in Illinois, 12,000 in Florida, 2,800 in Ohio, more than 2,300 homes in California, nearly 1,800 in Washington State and about 1,400 in Nevada. The listed prices of these properties vary from just $30,000 to $600,000 and higher. As per the 3.5 percent closing incentive, qualified buyers could save as much as $14,000 on a $400,000 home.

The "First Look" program Fannie Mae initiated allows potential buyers to take a look at the properties and bid without competition from investors. The company has also prohibited all possible bids by property investors during the initial 20 days after the listing; in the case of Nevada, the period has been extended to 30 days.

The 3.5 percent incentive is available only during the "First Look" periods from the middle of February through March. Each "First Look" listing includes a countdown clock that shows the number of days remaining prior to the commencement of the biddings for all potential buyers.

To avail the cash incentive, one must be a genuine owner-occupant purchaser and also commit to use the property as a primary residence for no less than a year after the purchase. The potential buyer has to fill out a certification to this effect available on HomePath.