â€¢ FHA & USDA require 3 years from the deed in lieu (only 1 year if it was due to extenuating circumstances)
â€¢ VA requires 2 years from the deed in lieu (only 1 year for extenuating circumstances)
â€¢ Fannie Mae & Freddie Mac require 2 years from the deed in lieu with 20% down (just 10% down if due to extenuating circumstances), or 4 years with 10% down regardless of the reason and then at 7 years maximum financing is permitted (which currently is 97%).
In all situations you need at least 12 months of re-established credit and 3 traditional trade lines, some lenders want 3 trade lines of 12 months each. Trade lines that survived the deed in lieu, such as a credit card you kept open, a car loan you maintained payments on, etc. can count towards the re-established credit.
The guidelines are the same regardless of where you are buying. There are what are called "portfolio" lenders, which make guidelines which do not have to conform to the above programs, and portfolio lenders will vary state to state, but they all have deed-in-lieu seasoning guidelines just as long and in majority of situations even longer.
At one point there were sub-prime mortgage lenders who would allow a purchase 1 day after a foreclosure or deed in lieu if you had a 10% down payment, etc. but sub-prime lenders really don't exist anymore, now they are basically hard/private money lenders.
Are you also Woodfloor34 in Utah because I answered a very similar question there too.
I would love to hear your story about why you decided to do a deed in lieu vs. doing a short sale on your home. Please email me. Don't worry, I'm not going to judge you or anything, but it's difficult to get in touch with previous owners who have chosen this option & I'm interested in your experience. You don't have to go into great detail about numbers & you don't have to give me any personal info.
I won't look back on this same Trulia thread for answers posted after mine.
Realtor Since 1996
Main Street Realtors