Repurchase in as little as 2 years after Short Sale!

Below are the general guidelines that FHA, Fannie Mae and Freddie Mac follow when considering a loan after a short sale or foreclosure:

Short sale with FHA Loan (As little as 3.5% down payment)

• Can purchase right away with no mortgage default
• 3 year wait if in default at the closing
• Reduced wait if the borrower has re-established good credit and can show extenuating circumstances

Short Sale With Fannie Mae Loan

• 4 year wait 

Short Sale with Freddie Mac Loan

• 4 year wait

Foreclosure with an FHA Loan (as little as 3.5% down payment)

• 3 year wait (from the sale date) before being able to get a loan
• Reduced wait if the borrower can show extenuating circumstances and re-establishes good credit

Foreclosure with a Fannie Mae Loan

• 7 year wait from the completed foreclosure sale date
• 7 year wait for a 2nd home, cash out re-financing, or an investment property

Foreclosure with a Freddie Mac Loan

• 7 year wait from the completed foreclosure sale date

When analyzing the difference between completing a short sale or going through a foreclosure in regards to purchasing another property in the future it boils down to the waiting time which is more favorable in a short sale.

If you have had a bankruptcy:

If you have just filed bankruptcy, you will not be able to qualify for a mortgage immediately. The amount of time that needs to pass after a bankruptcy will depend upon the type of loan you want, the type of bankruptcy you filed, and how good your credit is at the time you want the loan.

FHA Loans and VA Loans

If you had a Chapter 7 bankruptcy, you must wait two years from the date your bankruptcy was discharged in order to get an FHA or a VA loan.  You can obtain an FHA loan during a Chapter 13 bankruptcy as long as you have made 12 months of satisfactory payments, but you must receive approval from the bankruptcy court to get the loan.

Conventional Loans

Conventional loans have the longest waiting periods. You must wait four years after receiving a Chapter 7 discharge and two years after receiving a Chapter 13 discharge. If your Chapter 13 case was dismissed without a discharge, you must wait four years from the date of the dismissal.