There's Never Just One Cockroach
I mean you have to admit that as far as sayings go, the one in the subject line is just about perfect; short, funny, edgy and all too close to home for any of us who have ever called home someplace a little less than luxe. So it must be true that as we begin 2017, for every call I field where a prospective home buyer will say, "Well, I had a short sale a few years ago..." there are probably a hidden, greater number of those who, for whatever reason, just don't call. And by all means, I am certainly not calling those folks cockroaches, but what I am saying is that the target of this post is that demographic in the 
shadows. More specifically, it is those who require a jumbo loan, yet have had a short sale at some point over the last few years and who still harbor fears that they could not possibly be pre-approved for a mortgage now. Dreams of home ownership and getting off the rental treadmill? Well, they will just have to wait, right?
The table below will show you that for the most part, our best jumbo mortgage options available after a short sale are directly in line with the conventional waiting period of four years. So that means that anyone who sold a home for less than they owed on it before the year 2013 could very well be obtaining terms today that are equivalent to Buyer B, who did not have a short sale. And if there's more good news to report, the math is on our side too. The vast majority of short sales occurred before 2013.
Even in cases where the short sale was very recent --- as little as one year ago --- we have options for the prospective buyer. Let's take a quick look at the guidelines for jumbo mortgages after a short sale with all of our current investors:
One year after a short sale:
- $1,000,000 max loan amount with a 20% minimum down payment and a 640 minimum FICO score
- $2,000,000 max loan amount with a 25% minimum down payment and a 660 minimum FICO score
Two years after a short sale:
- $2,000,000 max loan amount with a 10% minimum down payment and a 720 minimum FICO score
- $2,000,000 max loan amount with a 20% minimum down payment and a 640 minimum FICO score
- $1,000,000 max loan amount with a 20% minimum down payment and a 620 minimum FICO score
Four years after a short sale:
- $3,000,000 max loan amount with a 15% minimum down payment and a 680 minimum FICO score
- $2,000,000 max loan amount with a 10% minimum down payment and a 720 minimum FICO score
So if you had a short sale at some point in your past, don't sell yourself short in 2017. If your scenario requires a jumbo mortgage in California, we may have a solution for you and it's time to stop hiding in the shadows.
Killing myths dead,
Robert J. Spinosa
Executive Loan Advisor
NMLS: 22343 CalBRE: 01297944
Cell: 415-367-5959 Fax: 415-366-1590
rspinosa@rpm-mtg.com www.rpm-mtg.com/rspinosa
1058 Redwood Highway, Frontage Road, Mill Valley, CA 94941
RPM Mortgage, Inc. – NMLS#9472 – Licensed by the Department of Business Oversight under the Residential Mortgage Lending Act. Equal Housing Opportunity.
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