Wells Fargo releases new guidlines for Buyers who have had a short sale, foreclosure, or bankruptcy.

As of August 17th 2009...

After completion of a short sale

Caused by financial mismanagement:

• 4 Years are required to re-establish credit
• Minimum Credit Score = 680

Caused by extenuating circumstances:

• 2 Years are required to re-establish credit
• Significant written evidence to support the extenuating circumstances will be required

After completion of a foreclosure or bankruptcy

Caused by financial mismanagement:

• 5 Years are required to re-establish credit
• Minimum Credit Score = 680
• Up until 7 years from completion, addition restrictions apply:
  • Minimum 10% down payment required
  • No second home or investment purchases
  • No cash-out refinances

Caused by extenuating circumstances:

• 3 Years to re-establish credit
• Up until 7 years from completion, addition restrictions apply:
  • Written proof of extenuating circumstances
  • Minimum Credit Score = 620
  • No second home or investment purchases
  • No cash-out refinances

After completion of a deed-in-lieu of foreclosure

Caused by financial mismanagement:

• 4 Years are required to re-establish credit
• Minimum Credit Score = 680
• Up until 7 years from completion, addition restrictions apply:
  • Buyer may purchase an investment property or second home.
  • Cash-out refinances allowed
  • Evidence borrower has re-established acceptable credit history

Caused by extenuating circumstances:

• 2 Years are required to re-establish credit
• Minimum Credit Score = 620-680 (depending on other circumstances)
• Borrower may purchase a second home or investment property.
• Written proof and documentation of extenuating circumstances.