Obtaining financing through the traditional sources will be difficult as the majority of financing currently available right now is subject to either Fannie Mae or FHA guidelines, both of which restrict lending to homeowners with a short sale in their credit history.
Short sales and foreclosures negatively impact your credit, and bad credit implies that you as a borrower represent a higher credit risk which in turn hurts your chances of securing a mortgage. The logic is, if you werenâ€™t able to make your payments just a year ago, youâ€™re still considered a risky candidate for a new loan today. Here are the guidelines:
WAIT TIME AFTER A SHORT SALES
FHA- 3 year waiting period
VA- 2 year waiting period
Both FHA and VA require clear Caviers (Credit Alert Interactive Voice Response System)
2 year waiting period at 80% ltv*
4 year waiting period at 90% ltv *
WAIT TIME AFTER A FORECLOSURE
FHA -3 year waiting period
VA - 2 year waiting period
Both FHA and VA require clear Caivrs
7 years waiting period- all ltvâ€™s
3 years with extenuating circumstances
Additional requirements after 3 years up to 7 years.
90% Max LTV
Purchase, Principal Residence
Rate and Term Refinance, all occupancy
Note on FHA only- SHORT SALE WITH NO MORTGAGE LATES
No waiting period if there were 0 late payments throughout the entire Short Sale process and the borrower is relocating to another area.
For more info visit http://columbusrealestatenews.featuredblog.com/waiting-perio
Better Homes and Gardens Real Estate
Many people want to 'short' sale their home simply because they are upside down. A bank will often want to see evidence of a hardship to justify not making payments. This would be circumstances such as health, death, loss of income/job, etc.
It is never advisable to just stop paying your mortgage if possible. Talk to your lender and see what options exist to have your loan motified to a lower rate, term, etc.
Other than short sale of the property you can consider leasing it. If you lease for 2 yrs and show income from it, you may usually use this to buy however you would have to rent yourself during that period. Hope that helps and good luck to you.
In most cases, there will be a waiting period before you can qualify for a new mortgage. The time period may vary depending on your hardship. Certainly if you have the resources to purchase another home it is unlikely your current debtor will grant you a short sale without conditions.
The best person to discuss this with is your attorney and perhaps a knowlegable loan officer.
But, I would prepare myself to become a reanter.