Home Buying in 55391>Question Details

Realist, Home Seller in Minneapolis, MN

Are there any banks out there that will give you a loan 2 years after foreclosure if you have a 25 percent downpayment?

Asked by Realist, Minneapolis, MN Thu Jul 21, 2011

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• FHA & USDA require 3 years from the foreclosure sale date/when the home is no longer legally in your name (only 1 year if it was due to extenuating circumstances)
• VA requires 2 years from the foreclosure sale date/when the home is no longer legally in your name (only 1 year for extenuating circumstances)
• Fannie Mae & Freddie Mac require 7 years from the foreclosure sale date/when the home is no longer legally in your name (4 years if it was due to extenuating circumstances)

In all situations you need at least 12 months of re-established credit and 3 traditional trade lines, some lenders want 3 trade lines of 12 months each. Other than medical collections that can be properly explained, if there are any late payments or delinquent accounts (collections, charge-offs, judgments, tax liens) after the foreclosure then the time seasoning often starts over again from the latest late payment/delinquent mark (underwriter's discretion).

Having a verifiable on time housing payment history goes a long way to making an underwriter feel comfortable, as well as taking a pre-purchase housing counseling class with a budgeting/financial module. Practically anything you can do to prove that you have made & kept a vow to make all payments on time will be helpful.

Like Elliott said, local banks and credit unions may have special financing programs that do not conform to Fannie, Freddie, FHA, VA or USDA guidelines.
1 vote Thank Flag Link Thu Jul 21, 2011
Most traditional lenders will require a 3 year period since your foreclosure before considering you for a loan. You may want to try a small local bank or credit union in your community that funds and keeps their loans in-house rather than selling them off on the secondary market. Smaller banks like that have a little more flexibility so if you can document an extenuating circumstance for your foreclosure, have reestablished your credit along, have a good down payment and strong reserves it may be worth a look for some of these local banks.
0 votes Thank Flag Link Thu Jul 21, 2011
It depends on if you rebuilt your credit, the only one that can tell you is a loan officer, your bets bet is to meet with a local and trusted mortgage company who can prequailify you for free and let you know if there are any mortgages available to you given your credit score and financials. good luck
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Thu Jul 21, 2011
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