According to Freddie Mac,mortgage interest rates have held pretty much steady for the past three weeks.  The 30 year fixed rate is holding at around 3.53% which is still less than the 3.87% a year ago.  The 15 year fixed rate remained at 2.77% compared to 3.16% last year.  The rates are still right around the record lows but are expected to rise this year.

How is 2013 doing on the interest rate scene?  According to Freddie Mac, the first week of the new year opened at near record lows.  Rates for the week ended Jan. 3 averaged 3.34 percent for 30-year fixed loans.That’s nearly flat with the 3.35 percent last week but well off the 3.91 percent a year ago.  Fifteen-year fixed rate mortgages came in at 2.64 percent, down from 2.65 percent last week and 3.23  percent a year ago.

New short sale guidelines went into effect Nov. 1 for Freddie Mac and Fannie Mai backed loans.  The hope is that it will streamline the short sale process and get rid of some of the current backlog.  One of the most time consuming aspects of a short sale has been getting the approval of Fannie Mae or Freddie Mac.  The big question is whether or not junior lien holders will go along with the plan.  Under the new guidelines there is a maximum payout to second liens of $6000 which seems like a lot but may not be on larger loans.

This is not the 100% solution to the short sale problem but it should be a step in the right direction.  The burden will fall largely on the loan servicers that still have to handle the short sale process to make sure that the short sales are handled correctly and are properly executed.

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.