Freddie Offers Warranties on REO Homes

Purchasers of single-family foreclosed homes offered through Freddie Mac’s ""HomeSteps"":http://www.HomeSteps.com division will receive a comprehensive two-year home warranty paid for by ""Freddie Mac"":http://www.freddiemac.com, the company announced Monday. In addition, for a limited time, the McLean, Virginia-based mortgage financier said it will pay up to 3.5 percent of the sales price in closing costs, potentially saving buyers of HomeSteps homes thousands of dollars in transaction costs.
The new warranty incentive is part of a ""HomeSteps' SmartBuy"":http://www.freddiemac.com/news/archives/servicing/2009/20090720_homesteps-warranty.htmlxeSRVcing sales promotion, which began on July 17 and is scheduled to run through October 30, 2009. HomeSteps, the REO disposition and sales unit of Freddie Mac, markets a nationwide selection of Freddie Mac-owned homes.
Chris Bowden, VP of HomeSteps, said, ""This unprecedented offer will enable HomeSteps buyers to protect against unexpected repair costs which could interfere with their ability to meet their mortgage obligation. Combined with our offer to pay up to 3.5 percent of the sales price in buyer's closing costs, we believe HomeSteps homes will have a competitive edge at building buyer confidence and increasing sales for our affordable homes.""
The two-year warranty, called Home Protect, is provided by ""Cross Country Home Services"":http://www.cchs.com, which has nearly 30 years’ experience providing home warranty and home service-related plans on a national basis. Home Protect will cover electrical, plumbing, air conditioning and heating systems, as well as ductwork and many major appliances. Freddie Mac will pay for the first two years of the warranty after which buyers will have an option to continue the warranty on their own.
The warranty is available only on single-family HomeSteps homes. The home must be sold as primary residence for at least $25,000 in the 48 contiguous states or Washington, D.C. The warranty and closing cost opportunities are not available on HomeSteps homes sold as investor properties, second homes, or vacation homes. To qualify for the limited-time buyer's closing cost offer, buyers must submit initial purchase offers by October 31, 2009 and complete the closing by December 31, 2009.
Ingrid Beckles, SVP of default asset management at Freddie Mac, commented, ""We expect SmartBuy's comprehensive two-year warranty and closing cost offer to help more families buy and own HomeSteps homes, which in turn will help support home values and stabilize communities.""