@Tiffany- fortunately I am also a licensed Mortgage Lender that was until recently managing a firm with 120+ national registered loan agents. I sit on a few boards that currently handle solutions to curb the current mortgage mess in local communities. (probono) I figured citing well known names such as Fannie, that referencing the underwriting code wasn't necessary. I'm curious how you spend your day finding solutions for the matter? With Only 6 years experience and 2900+ blog posts on zillow alone, it is interesting. I agree with you, people need to consult their attorney's, and that does not include their legal assistants or law clerks...It really was unfortunate to see such hostility unravel with this question/post. I wish you all the best.
It is unfortunate to see so much hatred towards the real estate industry in this forum. I appreciate your feedback and encourage open dialog, however many of the facts that I stated above were referenced from Fannie Mae. Perhaps I should have cited the source for you all, but it seems you may still warrant that as "propaganda" The mention of your FICO going to 747 shortly after Foreclosure is a bit unbelievable. I have multiple examples that would prove your experience is either A: Untrue or B: Far from the norm.At the end of the day, people have free-will to foreclose if they want. I recommend they do not, and that they consult their CPA, Attorney AND REALTOR before doing so..I've assisted homeowners with both their short sale and foreclosure process and in many cases do not make a dime for it. Before bashing into the industry and specifically me "ShastaSteve and SunnyView -23129 posts on zillow forums-" I suggest you keep an open mind to my intention of positively contributing to the forum and the mess in which we have on our hands with the many upside down mortgages.
I have seen some questions in regards to the timeline of negative impact of a Short Sale vs. Foreclosure and hopefully I can shed some light on the subject. Please keep in mind, policies with lenders and credit reporting agencies change with time, and posts in forums like this online do not. At the time I writing this, Fannie Mae (the largest conventional mortgage buyer in the U.S) has become more lenient with their guidelines when lending to previously foreclosed homeowners. If the borrower has experienced extenuating circumstances such as death in the family, job transfer, or serious illness they may forgive the foreclosure and lend again within 3-7 years. If you do not have an extenuating circumstance, than you will see a 7-10 year period in which you can not borrow money. (from Fannie Mae)Bank guidelines, although mechanical in nature, are often decided upon by human beings. It is common sense for the underwriter to approve a mortgage to a previously foreclosed borrower if she lost a husband in war, or become seriously ill. However they will not be quick to lend to those who abuse the system and refuse to pay their mortgage for months, trash the house and refuse to leave when properly and legally evicted. The short answer (pun intended) to how long one can buy a home with conventional financing after a short sale is, 2 years. It is very simple and clear cut with underwriting guidelines. If you want to borrow FHA, it will be 3 years. Lastly, I want to point out the importance of selling short rather than foreclosing. Your credit score WILL drop significantly more and stay lower longer if you choose to have multiple late payments on your mortgage and foreclose. With that said, you can expect to see a rise with your credit card, auto loans and any other financing APR's. Short Sales can be an excellent way to avoid complete financial catastrophe. Thank you for the opportunity to post and I appreciate any feedback or questions.