I am looking to a less expensive fixer upper home and consolidate other debt in payment and short sale the home I am currently in. Is this possible?

Asked by Db, 94553 Sun Jan 29, 2012

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, ,
Tue Aug 26, 2014
Short sale waiting period for conventional financing has now been extended to 4 years from date of incident.
0 votes
, ,
Tue Aug 26, 2014
You can buy a less expensive fixer upper if you have enough income to qualify and if you qualify for a fixer up loan. However, your lender on your home won't approve a short sale; especially, with the market the way it is; it's a sellers market. You would have no case to apply for a short sale other than trying to take advantage of the market, but we're not in an overall downturn. That strategy won't work. Good luck.
0 votes
Allison Fish…, Agent, Ann Arbor, MI
Sun Jan 29, 2012
Hi Db,

You need to talk to an expert in your area that can answer your questions. First of all, you need to contact your bank and ask them for their policy/process for short sales and then contact a Realtor regarding it. In most cases and in most states you will need to qualify for a new home prior to selling yours as a short sale because once you have late payments on your record it would be very hard to qualify for a new one. There are several banks, mortgage lenders and REALTORS you can speak to about your situation, you do not have to hire them or follow their advice - however, it is the best way to determine your best course of action and your options.
0 votes
Annette Levi…, , New York, NY
Sun Jan 29, 2012
Neil, You are not allowed to short sale to take advantage of the lower prices and get another mortgage. DB would have to buy first and then short sale. That means having enough income to qualify to afford two homes.
0 votes
Neil Case, Agent, Martinez, CA
Sun Jan 29, 2012
DB,

Response #1 is only half correct. You MIGHT be able to do what you are talking about. First, in order to buyer again you'd need to qualify for a new loan (unless you paid cash). Most lenders will not lend to you if you have late payments from the last 12 months on your credit record. Typically (but not always) a short sale involves late payments on the mortgage you are short selling. Most lenders will not allow you to short sell unless you can demonstrate a hardship. One of the indications of a hardship is the inability to make the payments. Therefore, most banks essentially force you to be late in order to demonstrate hardship (among other types of hardship proof as well). However, there are some banks with some types of loans that will allow you to short sell without ever having a late payment. Doing this typically requires that you do have some significant or impending hardship. If you can get your current lender to allow you to short sell without being forced to be late then there are indeed some banks that will lend to you again IMMEDIATELY after a short sale.

I can find out quite easily if your current bank and your loan type will consider allowing you to do this. Simply contact me at your leisure this upcoming week. I'll go over it all with you. There's no charge and I promise you'll get sound advice without any sales talk. I live in Martinez and specialize in short sales.

Neil Case 925-382-7294
0 votes
Annette Levi…, , New York, NY
Sun Jan 29, 2012
No. If you short sale, you are not eligible for another mortgage for 3 years.
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