FORECLOSURE vrs. SHORT SALES...3rd POSTING
FORECLOSURE vrs. SHORT SALES...3rd POSTING
In my 1st 2 posts on this subject I outlined the consequences of short sales vrs. foreclosures on credit scores and credit histories...
TODAY'S POST LOOKS AT THE IMPACT OF BOTH ON FUTURE LOANS...
1st, regarding FORECLOSURE...the question on any future 1003 loan application , the prospective borrower will have answer "yes" to question C in Section VIII...that asks if the applicant had property foreclosed upon or if title had been given in lieu thereof in the last 7 years. This answer will affect both future rates and the ability to secure new lending.
...as regard a SUCCESSFUL SHORT SALE...no such declaration or question need be answered .
2ndly, a homeowner who loses a home to FORECLOSURE is ineligible for a Fannie Mae backed mortgage for a Primary Residence for a period of 5 years.
...but if a homeowner successfully negotiates and closes a Short Sale...that homeowner will be eligible for a Fannie Mae backed Mortgage for that same Primary Residence after only 2 years.
Regarding non -primary residences.... the period of ineligibility is 7 years regarding a foreclosure history vrs. 2 if a Successful Short Sale was negotiated and closed.
MY SUGGESTION IS TO CALL A LENDER FOR MORE INFORMATION REGARDING THESE INTERPRETATIONS OF THE LENDING PRACTICE.
IF YOU DID NOT READ MY 1ST 2 POSTINGS...VISIT www.AlansNotebook.com
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