Home Buying in California>Question Details

Thia, Both Buyer and Seller in

If your house is on a short sale which resulted to a bad credit, can you still buy a house in cash?

Asked by Thia, Tue Aug 19, 2008

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Can you rent the house out? If you have some cash to put down as a down payment and can show you have a lease in place to cover the current mortgage.. You may be able to pull it off. It will take a lil work and you will not get the best rate. However, you may accomplish what you are trying to do.

The money you pulled out, is 20% of your next purchase? That will surely help. You need to show the new lender you have all your liabilities covered.

I am not an attorney, just the King of Craigslist.
0 votes Thank Flag Link Tue Aug 19, 2008
Hi guys, sorry for the confusion. I tried to negotiate with the lender to modify my loan because my income is not enough and I am on a hardship. The people I talked to didn't act on my problem right away. While on this situation, friends advised me if I have a small amount I can use later to buy a home since the market is still down, I should pull them out right away. I pulled out my last savings for safety and still tried to talk to the lender. It was after three months of talking to them and 3 months of default in payment that they told me that I am not qualified for a loan modification and they already reported it to the credit bureau. The lender suggested to put the house on a short sale, going to a foreclosure.
This is my last shot to own a house. I only want a small house to retire to, cheaper and I can call my own. Right now there are a lot of cheaper houses on the market rather than renting.Can I still buy a house (if I can come up with cash)in this situation? What will happen to me considering I am on a short sale?
0 votes Thank Flag Link Tue Aug 19, 2008
Absolutely - cash is still king and there are still people that have it!
0 votes Thank Flag Link Tue Aug 19, 2008
If you have cash for the purchase, you should have no pro with your next purchase. However, if credit line is needed, some questions would need to be addressed

King of Craigslist
0 votes Thank Flag Link Tue Aug 19, 2008
Clean up your credit as soon as possible. You will most likely be refinancing/cash out within a few months so take advantage of my credit repair service to boost your score back up.
0 votes Thank Flag Link Tue Aug 19, 2008
Did you have a hardship at the time of the short sale? What changed so drastically that you went from hardship to having enough cash to buy a house without a loan? How long ago was the short sale?

I can imagine there are some circumstances that can bring about a substantial financial change in a short time period. Did the bank approve a short sale, but you paid back the lender after the title transfer? Some short sales are approved for title transfer with the seller agreeing to a post closing note to repay some or all of a shortage.

A lender who forgave debt in a short sale may become interested in your financial details....if they learned of a property purchase in cash shortly after a closed short sale.

But, yes, you can make a purchase in cash. If your circumstances have taken a positve change, congrats.
0 votes Thank Flag Link Tue Aug 19, 2008
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
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YES, since credit is no issue with the sale.
0 votes Thank Flag Link Tue Aug 19, 2008
I am confused. If you have enough cash to buy a new home, why would you be selling your home on a short sale? Where is the hardship?

-- I ditto that question.......


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0 votes Thank Flag Link Tue Aug 19, 2008
Thia:

I am confused. If you have enough cash to buy a new home, why would you be selling your home on a short sale? Where is the hardship?

However, in answer to your question, cash is king. As long as you don't have to use credit for the purchase, no one would even know what your credit scores are?
0 votes Thank Flag Link Tue Aug 19, 2008
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