Getting a New Mortgage after a Foreclosure or Short Sale?

Posted on Thursday, August 26th, 2010 at 12:05pm.

Getting a New Mortgage after a Foreclosure or Short Sale?

Every week, I receive an interest rate report from one of my local lenders.  A few weeks ago, he included some information that was not only interestng, but also a little disturbing.  It has to do with how long a person's credit is damaged after a foreclosure or short sale.  In other words, when can they qualify for a home mortgage again?

Here's some details:

FHA Loans

• 2 Years after a Bankruptcy discharge date

• 3 Years after a short sale or foreclosure

One exception to the short sale rule: if the client is current on his mortgage and all otherdebt at time of short sale, and an extenuating circumstance can be documented, then the client could get another FHA loan sooner.

Conventional or Fannie & Freddie Loans

• 2 Years after a short sale with no mortgage or credit lates.

• 4 Years after a short sale with credit lates.

• 5 Years after a foreclosure for a primary residence

• 7 years after a foreclosure for a 2nd home or investment property.

So there you go.  If you have any thoughts, your comments are welcome.

Mahalo For Reading.

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