source:
  type: guide
  id: fnma-sel-b2-1.3-01
  authority: Fannie Mae Selling Guide B2-1.3-01 — Purchase Transactions
  description: Fannie Mae Selling Guide B2-1.3-01 — Purchase Transactions.
  coverage_tier: operative
obligations:
- id: fnma-sel-b2-1.3-01-full
  canonical_id: fnma-sel-b2-1.3-01-full
  section: Fannie Mae Selling Guide B2-1.3-01 — Purchase Transactions
  type: do
  tags:
  - regulator-direct
  - fnma
  - selling-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Selling Guide B2-1.3-01 — Purchase Transactions
    source_class: fnma-guide
    source_url: https://singlefamily.fanniemae.com/media/document/pdf/selling-guide
    snapshot_id: 5f7b8b79da595d76
    fetched_at: '2026-05-25T14:09:57Z'
    content_hash: sha256:98cf85a02861bbe84914a0e339b327c8fc131869a8a573882007bbeea60c5701
    paragraph_quote: 'B2-1.3-01, Purchase Transactions (11/05/2025) Introduction This
      topic contains information on purchase transaction eligibility requirements,
      including: General Purchase Transaction Eligibility Requirements Requirements
      for Purchase Transactions with LTV, CLTV, or HCLTV Ratios of 95.01 – 97% Non-Arm''s
      Length Transactions Purchase of Preforeclosure or Short Sale Properties — Allowable
      Fees, Assessments, and Payments General Purchase Transaction Eligibility Requirements
      A purchase money transaction is one in which the proceeds are used to ﬁnance
      the acquisition of a property or to ﬁnance the acquisition and rehabilitation
      of a property. The table below provides the general requirements for purchase
      money mortgage transactions. Certain mortgage loans and products may have diﬀerent
      eligibility requirements for purchase mortgage transactions. If applicable,
      the diﬀerences will be stated in the speciﬁc mortgage loan or product topic
      section. ✓ General Requirements The minimum borrower contribution requirements
      for the selected mortgage loan type must be met. Proceeds from the transaction
      must be used to • ﬁnance the acquisition of the subject property, • ﬁnance the
      acquisition and rehabilitation of the subject property, • convert an interim
      construction loan or term note into permanent ﬁnancing, or • pay oﬀ the outstanding
      balance on the installment land contract or contract for deed. Published May
      6, 2026 171 ✓ General Requirements Proceeds from the transaction may not be
      used to give the borrower cash back other than the following: • an amount representing
      reimbursement for the borrower’s overpayment of fees and charges, including
      refunds that may be required in accordance with certain federal laws or regulations.
      The settlement statement must clearly indicate the refund, and the loan ﬁle
      must include documentation to support the amount and reason for the refund;
      and • a legitimate prorated real estate tax credit in locales where real estate
      taxes are paid in arrears. Note: If the borrower receives cash back for a permissible
      purpose as listed above, the lender must conﬁrm the minimum borrower contribution
      requirements associated with the selected mortgage product, if any, have been
      met. Reimbursements or refunds permitted above may also be applied as a principal
      curtailment in accordance with B2-1.5-05, Principal Curtailments. A prorated
      real estate tax credit is not an interested party contribution, and it cannot
      be considered when determining if the borrower has suﬃcient assets for the transaction.
      Exception: When the Closing Disclosure indicates an escrow account has been
      established and includes the portion of real estate taxes owed by the property
      seller for the period they owned the property, a prorated real estate tax credit
      from the property seller may oﬀset all or a portion of the funds needed for
      the escrow account. Requirements for Purchase Transactions with LTV, CLTV, or
      HCLTV Ratios of 95.01 – 97% If the LTV, CLTV, or HCLTV ratio exceeds 95% for
      a purchase transaction, the following requirements apply. Criteria Requirements
      LTV, CLTV, or HCLTV Ratio 95.01 to 97% Note: The CLTV ratio can be up to 105%
      if the subordinate lien is a Community Seconds loan. Loan Type Fixed-rate loans
      with terms up to 30 years. Note: High-balance and ARM loans are not permitted.
      Property and Occupancy One-unit principal residence. Manufactured housing is
      not permitted, unless the property meets the MH Advantage requirements. All
      borrowers must occupy the property unless there is a Community Seconds subordinate
      lien. Published May 6, 2026 172 Criteria Requirements Borrower Eligibility At
      least one borrower must be a ﬁrst-time homebuyer, as indicated on the Form 1003
      in the Declarations section, when at least one borrower responds “No” to the
      question about having an ownership interest in a property in the last three
      years. Homeownership Education See B2-2-06, Homeownership Education and Housing
      Counseling for requirements. Underwriting Method DU only Reserves Reserves requirements
      will be determined by DU. Other All other standard Selling Guide policies apply.
      Note: The above requirements do not apply to HomeReady mortgage loans. See B5-6-01,
      HomeReady Mortgage Loan and Borrower Eligibility, for requirements for HomeReady
      mortgage loans with LTV, CLTV, or HCLTV ratios of 95.01 – 97%. Non-Arm''s Length
      Transactions Non-arm''s length transactions are purchase transactions in which
      there is a relationship or business aﬃliation between the seller and the buyer
      of the property. Fannie Mae allows non-arm’s length transactions for the purchase
      of existing properties unless speciﬁcally forbidden for the particular scenario,
      such as delayed ﬁnancing. For the purchase of newly constructed properties,
      if the borrower has a relationship or business aﬃliation (any ownership interest,
      or employment) with the builder, developer, or seller of the property, Fannie
      Mae will only purchase mortgage loans secured by a principal residence. Fannie
      Mae will not purchase mortgage loans on newly constructed homes secured by a
      second home or investment property if the borrower has a relationship or business
      aﬃliation with the builder, developer, or seller of the property. Purchase of
      Preforeclosure or Short Sale Properties — Allowable Fees, Assessments, and Payments
      Borrowers may pay additional fees, assessments, or payments in connection with
      acquiring a property that is a preforeclosure or short sale that are typically
      the responsibility of the seller or another party. Examples of additional fees,
      assessments, or payments include, but are not limited to, the following: short
      sale processing fees (also referred to as short sale negotiation fees, buyer
      discount fees, short sale Published May 6, 2026 173 buyer fees); Note: This
      fee does not represent a common and customary charge and therefore must be treated
      as a sales concession if any portion is reimbursed by an interested party to
      the transaction. payment to a subordinate lienholder; and payment of delinquent
      taxes or delinquent HOA assessments. The following requirements apply: The borrower
      (buyer) must be provided with written details of the additional fees, assessments,
      or payments and the additional necessary funds to complete the transaction must
      be documented. The servicer that is agreeing to the preforeclosure or short
      sale must be provided with written details of the fees, assessments, or payments
      and has the option of renegotiating the payoﬀ amount to release its lien. All
      parties (buyer, seller, and servicer) must provide their written agreement of
      the ﬁnal details of the transaction which must include the additional fees,
      assessments, or payments. This can be accomplished by using the Request for
      Approval of Short Sale or Alternative Request for the Approval of Short Sale
      forms published by the U.S. Treasury or any alternative form or addendum. The
      settlement statement must include all fees, assessments, and payments included
      in the transaction. Recent Related Announcements The table below provides references
      to recently issued Announcements that are related to this topic. Announcements
      Issue Date Announcement SEL-2025-09 November 05, 2025 Announcement SEL-2025-03
      May 07, 2025 Announcement SEL-2025-02 April 02, 2025 Announcement SEL-2020-07
      December 16, 2020 Announcement SEL-2019-08 October 02, 2019 Published May 6,
      2026 174'
  judgment: false
