VA Mortgage Loan After A Short Sale

Reblogger Kim Peasley-Parker
Real Estate Agent with AgentOwned Realty, Heritage Group, Inc.

 

Very interesting question for VA mortgage holders.  If you have a short sale, can you use your VA eligibility again to purchase a home?  If so what are the requirements?

 

Original content by Eleanor Thorne NMLS 67179 Licensed in NC

Want To Buy A New Home?We just answered a question from a Veteran that went something like this, "I sold a home last year that had two mortgages.  The first mortgage was paid in full, the second mortgage was not.  Can I get a VA Loan now that it's been more than 12 months?"

There are two really, really important facts that we need before we can answer the Veteran's question.

The first one is - why did you short sale the home? Strategic Short Sales are not going to sit well with an underwriter, and could be the basis for denying the loan.  

Additionally, since it's been 12 months, we need to know if there were any late payments on the mortgage prior to the Short Sale.  If there were missed payments, then VA will make us wait three years before we can do another VA Mortgage Loan.

Since it was a first mortgage that was paid in full, it is unlikely that the Veteran has a delinquent FHA, VA or USDA mortgage loan balance showing.  If there WAS a delinquent Government loan balance - you would not be eligible for another Government Insured Loan.

The Veteran in this case has a credit score of 660, and the second mortgage does not show a deficiency balance owed, but it does clearly show on the credit report as a short sale.  The reason for the move was because the Veteran lost their job in Florida and relocated to NC with a job they've now held for over a year (same line of work). In this case, the Veteran never missed a payment on the mortgage - they simply did not have cash (they'd been living on savings while looking for a job) to cover the $25,000 short on the second mortgage.

In a case like this - 12 months must pass from the time of the short sale, and the application for a VA loan. Our underwriters require that we get some sort of statement from the Second Mortgage Holder indicating that they are not going to file a deficiency balance against the Veteran... we ARE able to make this loan.

If you've had a short sale, and you want to know if you can now purchase a new home in North Carolina - call Steve and Eleanor Thorne, FFSI, 919-649-5058 - we have the best mortgage rates and the lowest fees available!

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Topic:
Home Buying
Location:
South Carolina Sumter County
Groups:
AgentOwned Realty
Tags:
shaw homes
sumter homes for sale
sumter short sales
va eligibility after short sale
buy home with va after short sale

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Anonymous
Jamel

Can you please tell me why VA has their own underwriters and/or loan officers looking at your credit and such when all they do is give it to a bank. I have a charge off, but then settled with Chase(own the property free and clear now) and nobody can give me a strait answer on what my situation is. Apparently this is the 1st time this has ever happend because when I show my paperwork or tell my story everyone seems to be in awe... Short sale, Foreclosed, or what. Some say Short sale, but if it was why didnt Chase report "short sale" on my credit report? Others have no idea. Credit report  states "Legally paid in full for less than the full balence"  VA doesnt give you a home loan, a bank does so why does VA think they have a say if you get a loan or not? Why not just go to the bank? Am I wrong and if so please explain...On both situations.

Oct 23, 2010 01:46 AM #1
Anonymous
Joe

In 2009 I was layed off my job in OR. I fell behind and had to short sale my home. It closed in Dec 2009. Only one mortgage, an Indymac deal. 

I relocated to AL to find a new job and now I'm a Dept of Army civilian.

Current on everything after SS. Credit score around 650. Debt ratio 12%. No money to put down yet.

When can I buy a home here in AL?

Nov 02, 2010 09:25 AM #2
Rainmaker
330,163
Kim Peasley-Parker
AgentOwned Realty, Heritage Group, Inc. - Sumter, SC

Joe, I am a real estate agent and not a mortgage professional.  i would recommend you contact a mortgage professional in Alabama and inquiry as to what type of loan would be available and when you would be able to purchase another home.  Best of luck,

Kim 

Nov 03, 2010 01:17 PM #3
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Kim Peasley-Parker

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