Financing in 91915>Question Details

Mary Ann, Home Seller in 91915

I'm in a process of short selling my house. Once the process is done, what's my chance to be able to get a

Asked by Mary Ann, 91915 Fri Mar 21, 2008

VA loan with my husband? He wasn't on the loan with our first house.

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You probably cannot be on the loan with him for a couple of years
1 vote Thank Flag Link Fri Mar 21, 2008
Benefits of Short Sales

Here is a quick definition of a short sale. The lender allows a property to be sold for less than balanced owed and takes a loss. The benefit is you actually sell your house as opposed to going through foreclosure proceedings. Usually while all of this is going on you are already in a situation where you are behind on your mortgage payments. If and when you get a short sale going, make sure you use a reputable realtor that knows the short sale process.
Quick benefits of this process:
1. Better on your credit than foreclosure
2. Depending on how many late payments you had, you can recover fairly quickly
3. Typically can buy a home within 2 to 3 years
4. No foreclosure on your credit report

Short Sale Pitfalls

Once you have started the short sale process with a realtor and the lender has agreed to a sale price you probably now have 30 to 60 day mortgage late payments. As discussed in previous articles one late payment will drop you credit score 100 or more points. I am sure at this point you are not too concerned about mortgage late payments, but if you can try to make payments until sold. Most lenders don’t want to see 120 day late payments on a mortgage. Lenders consider120 day late payments t a foreclosure, even though technically its not. Housing and Urban and Development (HUD) actually count short sales with120 day late payments a foreclosure. Once you have this type of activity on your credit report, your only option for a mortgage in the near future will be FHA. I would make sure you don’t have 120 late payments so you can recover quickly once you are back on your feet. The credit reports I see with short sale activity always have 120 day late payments, but I have got individuals a FHA loan within couple of years after the fact.
Negative results:
1. Most lenders will consider a short sale with 120 day late payments a foreclosure, typically if foreclosure proceeding were started
2. May take you 3 years to recover and be able to Buy a again
3. HUD considers a 120 late payments a foreclosure on a short sale
4. Has a negative affect on your credit score because of late payments
5. Bank could come after you for the difference. Example would be if you owed 120,000 and you sold the house for $115,000. Then technically you owe the difference of $5,000.

This is a brief explanation of how a short sale can affect your credit report
0 votes Thank Flag Link Wed Apr 2, 2008
Chances may be very good. As long as yoour husband meets the qualifing requirements for the desired sales price he should be fine.
Web Reference:
0 votes Thank Flag Link Fri Mar 21, 2008
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