Friday, February 5, 2010

Completely and Utterly Off Topic and Yet Completely Relevant

Many know that I am in real estate, have been for 20 years. . . I love real estate, but never really blog about it because it's my job and blogging, along with my other hobbies are for fun. Anyway, this is a timely topic that I thought might help some of my readers regardless of where they live because of the economy which currently plagues us and by which I too have been completely affected. . .

A common question from borrowers and homeowners these days is how long they will need to wait to buy again if a negative item appears on their credit report. Different loan programs have different disqualification periods for Bankruptcy/Foreclosure/Short Sale. Once the automatic disqualification period has elapsed, the normal income/asset/credit requirements typically apply. It is also important to remember that if a mortgage account is included in a Bankruptcy, then foreclosure waiting periods apply with all loan programs. Here is breakdown by loan program:

Conventional Loans

  • Bankruptcy = 4 years
  • Foreclosure = 5 years
  • Short Sale = 2 years

VA Loans

  • Bankruptcy = 2 years
  • Foreclosure = 2 years
  • Short Sale = industry standard is 2 years

FHA Loans

  • Bankruptcy = 2 years
  • Foreclosure = 3 years
Short Sale = industry standard is 3 years unless no late mortgage payments have been made in the past 12 months and buying in a different geographic location (out of state job transfer for example).

In trouble? Find a qualified Realtor and find out all you can about your options before losing your home. It's worth trying to short sale first in most cases. Hope this detour from my regularly scheduled blogging helps someone!

P.S. For a more lighthearted post please see my post on my Moments in Time Blog and for a heart wrenching, but soul growing experience, you may want to check out my post here.

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