Profile picture for Teri the Great

Bouncing Back from the Mortgage Crisis

I originally became a homeowner in 1990.  In 2007, I used the equity in my first home to finance the purchase of an upgraded home at the cost of $370,000.  I had a 5-year ARM, but my home was underwater by $135,000 by the time loan was ready to adjust.  My lender "tried" to identify an appropriate loan product for me.  However, I got the sense that once my house was appraised to be in stellar condition, there was less enthusiasm for assisting me.  I was encouraged to "short sale" my home as there were no loan programs to support me.  My lender agreed to sell the home for $250K to my brother and I have rented from him since July 2012.  I am eager to purchase my home back as soon as possible.  However, I have many questions.  Are there HARP programs for former homeowners who lost their homes in the mortgage crisis?  Will I be treated like a first-time buyer given the fact that I have NO equity to roll into a home purchase AND have not enjoyed home ownership for the last 2 years?  What available loan products and down payment assistance is there for people like me?   I am almost 50 years old and fear that this situation has tarnished my family legacy.  I would like to start educating myself in preparation for restoration.  Any guidance that you can offer would be greatly appreciated!
  • October 03 2013 - New Castle
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Answers (2)

Profile picture for Teri the Great
Thank you!
  • October 04 2013
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Profile picture for Hugh Yamada
Hi Teri, 

You got lucky that the bank let you sell your home to your brother. Nowadays, the banks won't let you do that. As for the 'short sale', were you ever behind on the payments by more than 90 days? If not, then you need to talk to a loan officer. I had a client that had a 'short sale', but kept up on all their payments. They were able to buy a new home 2 years after the sale finalized. But, if you were late on any of the home payments, then you have to wait 4 to 7 years. There may be a FHA loan out there, but again, talk to a loan officer and see what you can qualify for. Or at least start rebuilding yourself towards home ownership again. HARP is only for owners in current trouble, they can't help you after you've already lost your home. 
  • October 03 2013
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