Profile picture for JohannaFitchRoady

I had a short sale back in March 2010. I want to buy a house with an FHA loan.

Do I have to wait 3 years before I can buy a house if I want to get an FHA loan?  The FHA loan only requires 3.5 down, but I was told I can't qualify yet.  What if I have a larger down payment like 5% down?
  • December 19 2011 - Saint Charles
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Answers (8)

Nope just 12 months if you have reestablished positive payment history..

he U.S. Department of Housing and Urban Development (HUD) recently announced the "Back to Work – Extenuating Circumstances" program, aimed to help people who have lost their home through foreclosure, short sale or bankruptcy. HUD has reduced the previously required minimum of 36 months to 12 months before they may be able to finance another home, given that they meet HUD's minimum eligibility requirements.
  • September 06 2013
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FHA guidelines require 3 years after a short sale, unless the house closed without any late payments over the last 12 months. This was possible a few years back, but now the banks almost always make the seller miss a payment before they will approve the short sale. The larger down payment won't make a difference. 

Good luck, use this time to improve your credit and save some cash and you will be in good shape when the time has passed.
  • December 31 2011
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Plan on 2 1/2 years regardless of the downpayment...underwriting guidelines will require it!
Best of luck....you are certainly not alone with your situation!
  • December 20 2011
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Hello,

After conducting a short sale, your credit score will be damaged at least for the next two years. 

You will be able to purchase a new property, after you do the necessary things in order to repair your credit. 
  • December 20 2011
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Profile picture for Jason_Brown

Hi Johanna, maybe you should call someone who has more experience with post short sale loan products...it will make the process easier. Good luck!

  • December 19 2011
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Profile picture for JohannaFitchRoady
Hi Jason,

Thanks for the reply.  I did speak with a mortgage broker that looked into my credit report and saw no signs of preforeclosure (it was due to a divorce and there were a few months that payments were not made, but I never heard the word foreclosure mentioned.  I was in contact with the mortgage company the whole time).  But when the mortgage broker contacted a couple of underwriters they said I needed to wait the 3 years.  When I did some online searching I saw that it's possible to get a home loan after 2 years.  Maybe I need to talk to another mortgage broker or contact him again?
  • December 19 2011
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Profile picture for Jason_Brown
Hello Johanna, if the home was not in foreclosure at the time of the short sale, you may actually be able to get a loan after 2 years. If your home was in pre-foreclosure or foreclosure at the time of the short sale, it will be a minimum of 3 years for an FHA loan. There are still secondary, "sub-prime" companies who will lend money to borrowers who have had a short sale but the terms are very unfavorable. Typically they require 25% cash down, 8-10% interest on a 3 year adjustable rate mortgage.
  • December 19 2011
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More is even better.
  • December 19 2011
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