Conventional guidelines will allow you to apply for a new loan 2 years after the short sale IF you have at least a 20% down payment. The waiting period may be waived if there are extenuating circumstatnces behind the short sale, such as death of a co-borrower or a prolonged documented illness.
FHA won't require as large of a down payment but they require a 3 year waiting period. A lender may make an exception to this rule for a borrower in default on his/her mortgage at the time of the short sale if the:
Â· default was due to circumstances beyond the borrowerâ€™s control, such as
death of primary wage earner or long-term uninsured illness, and
Â· a review of the credit report indicates satisfactory credit prior to the
circumstances beyond the borrowerâ€™s control that caused the default.
Those are straight from the conforming and FHA underwriting guidelines, although lenders may overlay their own waiting periods that may be longer.
hope this helps!