How to Buy a home after a Foreclosure?

Mortgage and Lending with Members Direct Home Loans # 1143904 NMLS # 314183

A common question is when can I purchase a home again after a foreclosure or short sale?

The short answer is it depends, in some cases one can purchase another home literally one day after a short sale. This is provided you were current throughout the short sale process. The requirement of being in current financial distress and behind on your payments is gone, One still has to prove a hardship which is expected to be long term such as the death, divorce and permanent lost of employment, such as forced retirement. The pool of homeowners who fall into the one day buckket is very limited although with an aging population this pool may grow.

 The majority of home owners who have gone through a short sale / foreclosure have hope in the not to distant future

Below is a general time line for buying after a foreclosure/ deed in lieu or a short Sale

Conventional Loans

FHA Loans

Foreclosure    7 Years

 ** 3 with Extenuating Circumstances 90% max LTV

Foreclosure  3 Years from completion Conforming loan limit’s only

7 Years for High Balance Loan Limits

Short Sale 

2 Years-80%  Max LTV

4 Years- 90% Max LTV

Short Sale 

3 Years from date of completion

USDA Loans

VA Loans

Foreclosure  3 Years

Foreclosure     2 Years with AUS approval  3 Years without AUS approval

Short  Sale    3 Years

Short Sale          2 Years with AUS approval  3 Years without AUS approval

Posted by

Kelly Welton

Regional Manager

Members Direct Home Loans

Office: 855-444-9878

Fax: 714-584-0854

20 Years of Mortgage Experience 


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Kelly Welton

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