Can I Buy After a Short Sale?

Yes, but there is a waiting period for each type of mortgage loan, except one loan type which I will get into later in this blog.

You also need to build your credit score back up by paying all bills on time and keep inquiries off your report. Inquiries from anywhere that you have applied for any kind of financing or leasing.

  • FHA loans are a wait period of three years when putting a down payment of 3.5%
  • Conventional loans wait period is four years when putting down a minimum payment of 5%
  • Conventional Loans wait period is two years with a minimum down payment of 10% and prove extenuating circumstances beyond your control.
  • USDA loans wait period has different wait periods that depend on the short sale circumstances at that time.

You can find out more detailed information about USDA Mortgage Loans by clicking on this link.

https://www.usdaloanpro.com/blog/2016/04/01/can-you-qualify-for-a-usda-loan-after-a-short-sale-2/

  • Fannie Mae HomeReady loans are four years when putting down 3%
  • VA loans are a wait period of two years and the down payment will still be 0%
  • Non-QM loans (Non-Qualified Mortgage) are the very next day. This is any mortgage loan that doesn’t comply with the Consumer Financial Protection Bureau’s existing rules on Qualified Mortgages (QM). Usually this type of mortgage loan helps buyers who are not able to prove they are capable of making the mortgage payments. You generally have to have a high credit score.

You can find out more detailed information about Non-QM Mortgage Loans by clicking on this link.

https://angeloakms.com/breaking-non-qm-correspondent-lending/

Information is not guaranteed over time due to Information changes without notice from the sources in this information. Please note the date of this information.

Can I Buy After a Foreclosure?

Yes, you can buy after a foreclosure, BUT with every mortgage loan types there is a wait time period that begins after closing, and the time period depends on the type of financing you had on the house.

You also have to have repaired credit to meet the credit requirements of the mortgage loan you are applying for.

Cash would be any time.

FHA (Federal Housing Administration) of three years is the minimum amount of time you have to wait. However, if you can prove the foreclosure was from a one time uncontrollable situation, FHA lenders MAY reduce the wait period to two years.

  • You have to put 3.5% down payment with a credit score of 580.
  • You have to put 10% down payment with a credit score of 500.

The lender may also require you to go through HUD Counseling.

Conventional loans backed by Freddie Mac or Fannie Mae is a seven years. This is the longest wait time period.

  • You have to put 5% minimum down payment. Percentage could be as high as 20%. There are variables that include credit score, conventional backing, points and so on that the lender will dictate.

Fannie Mae loans are seven years wait period, but you may get approved in three years as long as you can prove to the lender that your foreclosure was due to a one time uncontrollable situation. (Extenuating Circumstances).

  • You have to put 20% down payment with a credit score of 620.

Freddie Mac loans are seven years wait period, but you may get approved in three years as long as you can prove to the lender that your foreclosure was due to a one time uncontrollable situation. (Extenuating Circumstances).

  • You have to put 20% down payment with a credit score of 620.

VA (Veterans Affairs) loans are two years wait period.

  • You put $0.00 down payment with a credit score of 620.

Some Tips For You To Work On Before Being Approved For a Mortgage After Foreclosure

Paying all credit card debt

Paying your credit card debts down or completely off is one of the major ways to raise your credit score and prove to the lenders you are now financially able to pay your bills. Once you’ve paid off your credit cards you should see the change in your credit score within a month.

It is wise not to cancel your cards though, because these credit cards show the lender that you have an established trusting relationship with other peoples money. Cancelling your credit cards cancels that out.

Don’t apply for any other financing

Don’t increase your debt burden before applying for mortgage financing. This includes buying or leasing a car, buy now pay later furniture and appliances, rent to own furniture and appliances. Your debt-to-income ratio is one of the most important factors lenders look for when determining your eligibility for a mortgage.

Avoid any other negatives on your credit report.

After your foreclosure, paying all your bills and loan payments on time is crucial. You don’t want to begin the waiting for negative remarks to be removed again.

Collection accounts may remain for 7 years and 6 months from the date you first fell behind with the original creditor leading up to when the account was placed in collection.

Information is not guaranteed over time due to Information changes without notice from the sources in this information. Please note the date of this information.