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How long will I have to wait to purchase a house again?
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Short Sale
2 years
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Foreclosure
5-7 years
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What are the potential IRS tax consequences as a result of a short sale or foreclosure?
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Mortgage Debt Relief Act of 2007, provides certain protections from 1099 tax liability if the short sale is on a primary residence. Every seller’s financial situation is unique and it is advised that the seller seek advice from a tax professional for their own specific circumstances.
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The tax consequences for a foreclosure situation have the possibility of being even greater, based on the amount of dollars the lender is not repaid when the borrower defaults on the terms of the loan.
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What are the potential credit consequences as a result of a short sale or foreclosure?
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According to new Fannie Mae guidelines, after a two year waiting period from the completed short sale, borrowers can obtain new financing for any type of property i.e., primary residence, second home and/or investment - no other restrictions apply.
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According to new Fannie
Mae guidelines, after the required five+ year waiting period from the completed foreclosure, borrowers will be required to make at least a 10 percent down payment, and will need minimum FICO credit scores of 680.
In addition, borrowers will be limited to purchasing primary residence only.
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