Can I Buy a Home Immediately After a Short Sale?

Great info.  Thank you.

Thanks Markita, FABULOUS post that I immediately reblogged for my Sacramento localism crowd.

Great and honest info that we NEED TO GET OUT THERE!!

My best,

Tamara

I will re-blog too. I just spoke to someone last week who was in this exact situation. Job required them to move, they are keeping current on mortgage payments while renting an apartment, not easy but scrimping to get it done. Hopefully, they would be able to buy again, hopefully the lien holder will do the short without requiring them to stop paying.

Thanks for the post. In case if anyone needs it - please refer to HUD - Mortgagee Letter 09-52 dated 12/16/2009.

Very interesting post, I didn't realize it was even possible.  I do, however, agree with many here in that very few people will even qualify for this.  My guess is that less than 0.5% of short sellers are eligible for this, and most of them would probably prefer to not get right back into owning a home. 

Good post.  I had a prospect asking me about this the other day.

Here's how I read it.....feel free to correct me if I am wrong. Here is the mortagee letter everyone needs to read http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/09-52ml.pdf

It states NO ONE can purchase using an FHA loan for three years if they did a short sale to take advantage of the market (buy similar/larger home then they have now that results in owing less).  In this market it's imposible not to take advantage of the market.....homes cost less now and no way of getting around that.  The only time they can purchase after short selling is if they are moving for work/job transfer......and would cause an unreasonable commute from their current home.....probably needs to be more than 75-100+ miles each way.  Plus, the lender has to report on credit that the short sale serves in payment in full. 

And they cannot have been late on any installment debt liabilities...not just your mortgage.

Job loss is not an extenuating circumstance.....only death of a primary wage earner or long term un-insured illness.

Interesting.  I hate to see so many sellers damage their credit when times get tough. It would be nice to get these sellers right back into a house & be current on a loan.

Markita - Thank you for sharing!  I was not aware that buying so soon after a short sale would even be a possibility! 

What a great post. I wish i saw that post earlier.

I had someone calling and asking if he can stop payment on his house... so he can safe money and buy cheaper house in the same neighborhood.

It didn't sound good. My best bet was to refer him to real estate attorney.

Interesting and helpful. I will re post this blog and maybe send it to my short sale clients.. to give them hope.

Most people I am dealing with have a true hardship. But this means they are behind on the mortagage

and I thought that is the only way a bank would consider a short sale anyway? How does this fit?

Great post, their is life after a short sale, people need to really understand this and choose that option over a foreclosure.

To N. Peters,

Did you read page 5 of the Morgagee Letter, under the heading Exceptions, it says....Lenders may make exceptions to this rule for borrowers in default on their mortgage at the time of the short sale if:

...default was due to circumstances beyond the borrower control...

...review of the credit report indicates satisfactory credit prior to the circumstances beyond borrower control that caused the default....

Frances - Since you are moving for work, and your short sale is not 'distressd', it's likely you will be able to purchase a new home after short selling.  But if that proves to be too difficult, you could purchase a home while simutaneously renting out the AZ home for maybe 1-3 months.....then short sell it.

These are just a few ideas off the top of my head.  I'm a loan officer in Southern California but could refer you to a local loan officer up there up in Nor Cal where my company is actually located if you want.

Great post Markita.  We definitely need to get this information out to buyers, because many of them will be sitting on the fence thinking that their short sale has disqualified them from buyer and that may not necessarily be the case.