Have you wondered how buying a home after a short sale or foreclosure works? Since the housing market crisis, many people have found themselves selling their home as a short sale or they have been through a foreclosure. The majority of these former homeowners has either found living arrangements with family or friends or has been in a rental property since they could not buy a home after a short sale or foreclosure.
With the great interest rates and low home prices many of these people would like to buy their own home again but how does that work? Depending on the situation, they may qualify for a loan in as little as 3 years!
If someone was foreclosed on, FHA requires a 36 month waiting period and Fannie Mae or Freddie Mac require 84 months from the completion of the foreclosure.
If someone sold in a short sale, FHA requires a 36 month waiting period, Fannie Mae requires 72 months and Freddie Mac 48 months.
These numbers are general guidelines, there are extenuating circumstances, other types of loans and the time may vary from state to state. If it has been at least 3 years since the short sale or foreclosure was completed, contact a mortgage professional to see if you may qualify for a mortgage to purchase a home. In the meantime, work on your credit score, pay your bills on time and do not take on excessive amounts of debt.