Financing in San Jose>Question Details

EC, Both Buyer and Seller in Santa Clara County, CA

Advice for finding lenders after short sale?

Asked by EC, Santa Clara County, CA Thu Sep 30, 2010

I did a short sale on one of my properties 1 yr ago. I know the general minimum is to wait 2 yrs to be able to qualify for a loan. Does anyone know of any programs/lenders that will approve a loan prior to the 2 yr rule?

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While I can sympathize with your short sale dilemma, unfortunately, lenders are not so kind. As Bill noted below, if your short sale was completed one year ago, there will likely be delinquent payments and circumstances that would not qualify you now for a new loan.

Granite Financial, here in San Jose, is a hard money lender, and they "might" be able to provide you with funds for a new home, but I will caution you that "hard money" or, more correctly, "private" money lenders are not cheap and both interest rates (hovering around 9-11 percent) and closing costs (as much as 50 percent higher than under a conventional loan) will be costly. Remember, too, that "hard money" does NOT in any way mean "easy money." A good private investor or company that manages and pools funds of private investors will scrutinize your financials, taxes and income sources as much as, if not more than, any bank would, so if you're not credit worthy by bank standards, you may also be similarly regarded by a private investor.

As the others mentioned, it would be far better for you to wait the two or more years it will take to repair your credit and to accumulate the funds needed to satisfactorily complete a sale using conventional loan sources if you qualify. If you've found a great home and cannot wait until the later time period, then contact Granite as starting place to find a private investor.

Grace Morioka, SRES
Area Pro Realty
1 vote Thank Flag Link Thu Sep 30, 2010
I wanted to introduce you to the "FRESH START" Portfolio Loan Program.

This is a Special Home Loan Program that WE FUND, where we can provide a mortgage loan for a borrower 1 day after a Shortsale or a Foreclosure, and only 6 months after a Bankruptcy.

This is NOT "Hard Money" financing.

This program is built for homebuyers or homeowners to obtain mortgage financing that might not qualify for Conventional or Government (FHA/VA) financing due to a recent derogatory incident on their credit.

We are eager to explain in more detail about the program.

Call me to learn more, 619-269-9871 ext 1

You can also get information on our website at

Here is a link to a brief video:

Brendan Bracken
Mortgage Advisor and Regional Manager, NMLS#247272
619-269-9871 ext 1

Peoples Mortgage - San Diego Branch
2550 Fifth Ave, #167
San Diego, CA 92103

Additional Info:
Fresh Start Frequently Asked Questions

We lost our home in foreclosure and are currently renting. With housing prices so low, is there any way we can buy a home while rates are at these historically low levels?
Everyone tells you NO, but with Peoples Mortgage Company’s Fresh Start Loan Program, even someone with a foreclosure, short sale or recent bankruptcy can qualify for a mortgage.

I have heard of this program, but don’t you charge a ridiculously high interest rate?
No. This is not a “hard money” loan program. Unlike “hard money” loans, the Fresh Start program offers a competitive interest rate and has all the features of a traditional mortgage.

This sounds too good to be true! What’s the catch?
There is no catch! The Fresh Start loan allows you to get out of that rental and own your own home again. You can rebuild your credit and stop throwing away money on rent payments. Start building equity in your new home! The Fresh Start loan is a 5/1 or 7/1 ARM designed for:
Borrowers who lost a home in the recent downturn but who are otherwise responsible borrowers.
The purchase or refinance of a primary residence.
Full income documentation and 25% down payment is required! *30% required if prior BK.
20% Downpayment is available - WITH an EXCEPTION
How do I apply for the Fresh Start Loan?
Contact BRENDAN BRACKEN, Regional Manager, at 619-269-9871 ext 1
0 votes Thank Flag Link Sat Sep 13, 2014
He probably figured it out by now as this question is four years old.
0 votes Thank Flag Link Mon Aug 4, 2014
This is a very good timeline question, actually. The "general minimum" of 2 years you talk about comes from conventional financing (Fannie Mae to be exact). Fannie Mae, for quite some time, has had a 2 year minimum waiting period after Short Sales, as well as a 7 year waiting period after foreclosure. Come August 16, 2014, Fannie Mae will be increasing the 2 year waiting period to 4 years. They will also be decreasing the 7 year waiting period for foreclosures to 4 years. This, of course, is good news for those with recent foreclosures, bad news for those with recent short sales. If buying a primary residence, FHA and VA offer lower waiting times. FHA is a 3 year waiting period (for both short sale and foreclosure) and VA (only eligible borrower is a veteran) offers a 2 year waiting period.

I hope this gives you some clarity on the subject, and I would be happy to answer any additional questions you may have.

Dave Setti
Turnkey Mortgage Solutions
0 votes Thank Flag Link Mon Aug 4, 2014

Thanks for your question.

Regret to hear about the Short Sale.

When you get a chance do call me.

Best regards

Web Reference:
0 votes Thank Flag Link Sun Apr 13, 2014
See Comstock if you have a buyer in need. Get a flexible credit loan. This program assists homeowners who have recently been through a foreclosure, short sale or have recently emerged from bankruptcy.
0 votes Thank Flag Link Fri Apr 11, 2014
If you are VA eligible no problem 1 year after short sale. If you have 20% down I have a portfolio loan with NO waiting period after a short sale. If the short sale was due to a reduction of income (and/or job loss) we could do a FHA loan 1 year after a short sale.
0 votes Thank Flag Link Thu Sep 19, 2013
Yes.. We do! We can approve a borrower just one day after short sale or foreclosure. It's a portfolio program and not "hard money" so the rates are much better.
0 votes Thank Flag Link Thu Sep 19, 2013
I just found a site that tells you if you can qualify for a mortgage after a short sale or foreclosure. try http
0 votes Thank Flag Link Sat Aug 10, 2013
No, just be patient. Your credit score probably took a hit work on a better credit score and start asking the question just before 2 year requirement is up.
0 votes Thank Flag Link Sun May 12, 2013
I had a short sale last year and my Realtor recommend for a home loan. I am very happy to be able to purchase again.
0 votes Thank Flag Link Sun May 12, 2013
EC ,
Do not leave out a lease with an option to buy, I have clients who are taking that route.
0 votes Thank Flag Link Wed Oct 20, 2010
If you were not late on any mortgage payments, a new Bill may pass before the end of the year that may help folks like yourself.
Web Reference:
0 votes Thank Flag Link Sat Oct 2, 2010
Some hard Money lenders will do a loan with 6 months out of a short sale, but the rates are high and a large downpayment is required

Elena Ollick
Amerivest Realty
Faith Home Loans
Latest Post: Naples Luxury Home on Fire
0 votes Thank Flag Link Sat Oct 2, 2010
EC were you delinquent at all during the short sale?
0 votes Thank Flag Link Thu Sep 30, 2010
hi EC,
you always have the option of private money or hard money loans.
0 votes Thank Flag Link Thu Sep 30, 2010
Helo EC,
Just to add a couple of details to other info provided. You must have never had a late payment as stated, but also the Mortgage must have been current at the time of sale. Possible now but probably not a year ago. One other clarification. Divorce is not a mitigating factor. If you want to explain what happed in your case we can advise whether you could buy again in the near term.
0 votes Thank Flag Link Thu Sep 30, 2010
If you weren't late on your mortgage payments up to and during the short sale, and if your reason(s) for it were either due to i.e. a relocation, divorce, and/or cut in pay, there's a chance you may qualify now. Contact a licensed and/or local lender for further assistance. Good luck.
0 votes Thank Flag Link Thu Sep 30, 2010
You can get low downpayment FHA loans even after a Short Sale. However, Gregorio is absolutely correct in terms of requirements. Otherwise, just stay clean and try in couple of years.
0 votes Thank Flag Link Thu Sep 30, 2010
Only if you were never late on any payments and have a good reason for the short sale, like job relocation. Otherwise; not a chance!
Web Reference: http://WeFixRates.Com
0 votes Thank Flag Link Thu Sep 30, 2010
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