Guidelines And Tips On Qualifying For Mortgage After Short Sale
This Article On Guidelines And Tips On Qualifying For Mortgage After Short Sale
Qualifying For Mortgage After Short Sale requires mandatory waiting period after short sale on government and conventional loans. Gustan Cho Associates has non-qm loans where there is no waiting period to qualify for mortgage after short sale.
- A short sale is when a mortgage lender will approve a homeowner who has a mortgage higher than the value of their home sell their home
- The lender will forgive the negative deficit of their mortgage loan balance
- Short sales were extremely popular after the 2008 Real Estate and Mortgage Collapse
- Home values have plummeted throughout the country after the real estate meltdown of 2008
- Millions of homeowners were stuck in homes where they could not sell
- This was because the balance of their loan was higher than the value of their homes
- Lenders were offering short sales to homeowners with underwater mortgages in lieu of foreclosure
- This is because they can close their books much sooner and avoid the lengthy and costly process of foreclosure
In this article, we will discuss and cover Guidelines And Tips On Qualifying For Mortgage After Short Sale.
How Does a Short Sale Work?
Homeowners who are stuck in a home with a mortgage balance that is higher than the value of their home may consider a short sale instead of foreclosure.
- The first step is homeowners need to ask the current lender whether they will entertain a short sale
- Most lenders will authorize a short sale instead of going through the process of foreclosure
- Foreclosure Process can take a very long time, cost thousands of dollars in legal fees, and take up hundreds of hours of work from the lender
Once the lender gives homeowners their blessings, they contact a realtor and have the realtor do a market analysis of the home.
Home Buying Process After Pre-Approval
Homeowners get to choose their realtor of choice:
- Everything homeowners do during the short sale process they will need the approval of mortgage lender
- The lender will review all the real estate purchase offers by potential home buyers
- Lenders need to approve it and sign off on it
- After listing the home and get a solid purchase offer, the offer needs to submit to the lender for them to sign off on it
- Short sales take substantially longer for a home buyer to close
- Most home closings are closed in 30 to 35 days
- A short sale home buyer may need to wait 90 days or more to close on their home purchase
This is because lenders take their sweet time.
Waiting Period Requirement In Qualifying For Mortgage After Short Sale
There is a mandatory waiting period after a short sale to qualify for a mortgage loan.
- Qualifying For Mortgage after short sale for USDA and FHA Loans, the waiting period is three years after the short sale date of their home
- For conventional loans, there is a four-year waiting period to qualify
- There is an exemption where there is no waiting period after short sale if homeowners have not been late with any mortgage loan payment until the date of the final short sale date
- Unfortunately, many folks do not meet this exemption
- This because their lender will require that they skip a mortgage payment for their short sale to be effective
- There are times where a lender will let the homeowner be timely with their mortgage loan payment until the date of the short sale
- If this is the case, there is no waiting period after a short sale to qualify for either an FHA Loan, Conventional Loan, VA Loan, or USDA Loan
Two-year waiting period to qualify for VA Loan after a short sale.
Qualifying For Mortgage After Short Sale With No Waiting Period
Government and Conventional Loans have a mandatory waiting period after a short sale. There are many states such as Florida, Texas, Georgia, California, Illinois, Colorado where home prices have been increasing double digits since 2012 with no signs of correction. Many qualified home buyers are seeing home values appreciate before their eyes and cannot purchase a home because they do not meet the mandatory waiting period requirements. Gustan Cho Associates now offers non-QM loans where there are no waiting period requirements after a short sale. 10% to 20% down payment is required. No maximum loan caps. No private mortgage insurance required. Mortgage rates are determined by borrower’s credit scores and down payment. The amount of down payment depends on the borrower’s credit scores. Contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at alex@gustancho.com.
