Surviving the Short Sale Seasoning Status Shift

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Mortgage and Lending with Guaranteed Rate, Marin County, CA NMLS: 22343

Surviving the Short Sale Seasoning Status Shift

 

All alluring alliteration aside, I wanted to get serious (there I go again...) about the recent changes to the waiting periods that are required when a buyer attempts to re-enter the mortgage market.  "How long do I have to wait after a short sale?"  That's been a question that our industry has faced since the downturn.  This blog post is going to focus specifically on jumbo loan amounts and RPM's time requirement for buying a home after a short sale.

Up until just recently (July, 2014), many of us in the industry had become intimately familiar with the guidelines: 

 

Rob Spinosa Mortgage California

Conforming Loans

  • A 2-year wait if the new loan-to-value (LTV) is 80% or less.
  • A 4-year wait if the new loan-to-value is between 80% and 90%.

FHA Loans

  • A 3-year wait at all LTVs.

Jumbo Loans

  • Dependent on investor, but mostly a 7-year waiting period.

 

As of July, 2014, the conforming waiting period after a short sale has been changed to no less than 4 years, regardless of LTV.  This implies that between years 3 and 4, if a buyer wishes to re-enter the purchase market, he or she will be subject to FHA's hefty mortgage insurance premium.  That is....unless the loan amount exceeds $417,000.  

RPM has all along retained an investor who has a 3-year seasoning period for a short sale AND we can start at loan amounts as low as $417,001.  Here are some of the other requirements and features of this program:

Rob Spinosa California Home Loan

 

  • 80% LTV to $1.5MM with a 720 FICO
  • 70% LTV to $1.5MM with a 700 FICO
  • 15 and 30-year fixed, along with 10/1, 7/1 and 5/1 ARM programs
  • 43% maximum debt ratio (DTI)
  • Great pricing!

 

Re-entering the real estate market after a short sale can be a challenge when your scenario calls for a jumbo mortgage.  But if your short sale happened 3 years or more in the past and you're looking to purchase a home in California, I may be able to assist you right now. 

 

Rob Spinosa
Mortgage Loan Originator
NMLS: 22343  CalBRE: 01297944
Cell:  415-367-5959     Fax:  415-366-1590
rspinosa@rpm-mtg.com     www.rpm-mtg.com/rspinosa 
1058 Redwood Highway, Frontage Road, Mill Valley, CA  94941

 

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RPM Mortgage, Inc - BRE# 01818035 – NMLS# 9472 - CA Bureau of Real Estate, Real Estate Corporation License. Equal Housing Lender.

 

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Tags:
credit
home loan
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california
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Ambassador
1,344,206
Gayle Rich-Boxman Fishhawk Lake Real Estate
John L Scott Market Center - Birkenfeld, OR
"Your Local Expert!" 503-755-2905

Rob, this is INCREDIBLE information! I just learned about some of the parameters of getting a loan after a short sale, foreclosure or bankruptcy and how it can change depending upon the type of loan. I wrote it all down, because I have a marvelous loan officer who always teaches me. 

Jul 26, 2014 05:59 AM #1
Rainmaker
142,536
Diana White-Pettis
Bennett Realty Solutions - Upper Marlboro, MD
GRI, CDPE, CNE, WHC Upper Marlboro Homes for Sale

Rob this is an awesome post!  Thanks for sharing this information.  It is definitely a "must know" for homeowners who have found themselves in any of these situations.  Have a great weekend.

Jul 26, 2014 06:30 AM #2
Rainmaker
543,701
Rob Spinosa
Guaranteed Rate, Marin County, CA - San Anselmo, CA
Vice President of Mortgage Lending, Marin County

Gayle and Diana --- thanks for the support and great comments.  We, in the mortgage industry have become accustomed to guideline changes and restrictions, but this one, at this time, took many of us by surprise.  I am glad we're still offering a 3-year waiting period on a short sale, at least on the jumbo side.

Jul 26, 2014 11:54 AM #3
Rainmaker
1,496,212
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

Why they change these terms so many times?

Well, I personally support a longer wait time, so clients can heal financially and emotionally. 3-4 years sounds about right.

Oct 02, 2014 08:21 PM #4
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Rainmaker
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Rob Spinosa

Vice President of Mortgage Lending, Marin County
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