Hello Catherine, you may qualify with a Chapter 13 after one year of on time payments. You may qualify conventional ONE DAY after a short sale, foreclosure or deed in lieu with 20% down and minimum 660 fico score. You may qualify FHA ONE YEAR from a short sale, foreclosure, deed in lieu or BK from a minimum 580 fico score and 3.5% down or even as low as .5% half percent down payment program.
I don't understand what your saying with working on a short sale for your primary and also saying you have been renting for two years now? If you are current on your mortgage you can definitely qualify FHA. It only takes a few dozen questions to qualify and go over your options. Here are some blogs such as Qualify FHA only 1 year from short sale, Which loan is right for me, Down payment and closing costs hurdles and Pre-approval in minutes.
Sheryl Arndt, Real Estate Broker - Sr. Loan Officer CA only
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GSE guidelines for cash out refi limit your cash out to 70% on duplex property or up to 75% on a single family house. I expect the HELOC guidelines for most lenders to conform to that LTV maximum limit.
You indicated that it is now free and clear.
So if your property value is $200,000 the most you can pull out is $150,000 (less any lien that has to be paid off) if it is a house, or $140,000 if it is 2 to 4 units.
If it is 5 or more units. It is a whole nother ballgame.
You can get 90% to 100% of the value out if you sell it. First, get a estimate of value and marketing plan from one of the Realtors that responded to your post. Your best prospect to buy it if it is a single family house is the tenant that is living there now.
Because you own it free and clear, you could sell it with owner financing, take a large down payment for the cash you need, then take payments that are the same size as the monthly rent you are currently earning, without having to shoulder the insurance, maintenance, property tax, and utility bill that you currently carry.
These are just random ideas, may not fit your personal situation. But it is okay to consider alternatives before you commit to the equity loan.... more