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Buying after short sale

Profile picture for user615153
I had a short sale of a home at the end of 2009 due to a divorce and was unable to sell the home through traditional means. I began talking with mortgage lenders earlier this year in an effort to position myself to buy another home in the future. I was told to start looking at homes and we discussed price ranges at the time. About a week ago, we found a home and made an offer which was accepted. The next day, my broker called and let me know I now needed 20% down due to the short sale. This created a small issue, but not a huge one and I was able to come up with the funding for the downpayment. My gut continues to tell me something is amiss, however and I talked to my broker a few days ago. I was told that I came back from the automated system as approved eligible, but that the underwriters may catch something else because the system isn't always sophisticated when determining short sale timing. The short sale is causing the main issue as my reserves, income, etc are not a problem. The broker suggested that we could work through the sellers and rent the property until eligible to close, which sounds pretty far fetched to me.
Long story short, I do not want to go so far down this path only to find out that I cannot be approved. Should I try another bank? Any suggestions are welcome.
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February 20 - Staten Island
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Answers (1)

Profile picture for Courtesy Mortgage
For Conventional (Fannie Mae) loan, two years must have elapsed from the completion of the short sale (recording date) and minimum 20% down payment is required.

Your loan application must be dated at least 2 years and 1 day after the recorded date, as long as your meet that criteria and have 20% down, you should be OK.

Sometimes credit bureaus don't code the short sales correctly which can "mess up" the automated system.  In your case, you have stated that you did get the approve/eligible finding, so that is a wonderful start for you.
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February 20
 

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