shortsales? what is the update on how long after can one buy a home?

Mortgage and Lending with Vandyk Mortgage Company

I have a client that wants to buy another home but told me he had a short sale 3 months ago and was told that he could not buy another home and that the short sale showed up as a foreclosure on his credit report.

Comments (10)

Steven Wright
Home Real Estate - Aurora, CO
CRS - Home Real Estate - 720-989-5283

I believe that it stays on the report for as something that can be held against you for 2 years. I could be wrong and welcome the correct information.

Dec 11, 2008 12:42 PM
Vandyk Mortgage Company - Groveland, CA

Thanks for the reply... I thougt I read somewhere 3 years but not sure either..

Dec 11, 2008 12:55 PM
Kelly Willey
Long and Foster BEL AIR MARYLAND - Bel Air, MD
Short Sale Agent - Harford County Maryland Real Estate

I have not seen any credit reports, post short sale

Dec 11, 2008 12:58 PM
Marilyn Harrell
Better Homes and Acres - Beaverton, MI
Wixom Lake - Beaverton MI

It does show up I hear, and it is up to a couple years or more.

Dec 11, 2008 01:14 PM
Ross Hair
Real Estate Advocate - Niwot, CO

Fannie Mae released a guideline on June 25, 2008:

Short sale -  2 years

Foreclosure - 5 years

Bankruptcy - 5 to 7 years

Here's link to their guideline ...

Ross Hair

Real Estate Advocate

Dec 11, 2008 01:45 PM
Vandyk Mortgage Company - Groveland, CA

Thanks for your replies.

Dec 11, 2008 02:34 PM
Regina P. Brown
MBA Broker Consultants - Carlsbad, CA
M.B.A., Broker, Instructor

Maryann, it depends on the lender, some don't care if it's on your credit report BUT will charge a higher interest rate (hard money)!

Join my NEW group for professionals who work from their home office at

Regina P. Brown
Allison James Estates & Homes

Dec 11, 2008 05:25 PM
Ross Hair
Real Estate Advocate - Niwot, CO

Fannie Mae and Freddie Mac indirectly account for around 50% of all mortgages as they purchase about 50% of all new loans on the secondary market. The is means that your buyers will not get a loan for two years if their lender intends selling it to Fannie or Freddie. However, your borrower may get a loan from a portfolio lender that will not sell the loan to Fannie or Freddie. Small banks will often have portfolio loans but will require a larger down payment to offset the lower FICO score.

Please also note that the 2 year wait is a Fannie and Freddie guideline and doesn't apply to other credit applications like for a car, overdraft or credit card etc.

The real damage is that your buyer probably has 30, 60 and 90 day lates on a mortgage account. This will have a very negtive effect on his / her FICO score. The second problem is that the debt will be written off and will show on his / credit report - also very bad for FICO score.

This means your buyer is a sub prime buyer and unfortunately there are very few sub prime lenders left in the market.

I hope this information doesn't completely ruin your day :)

Real Estate Advocate

Dec 12, 2008 03:49 AM
Vandyk Mortgage Company - Groveland, CA

Thank you so much for your reply.

Dec 16, 2008 11:21 AM
Vandyk Mortgage Company - Groveland, CA

Can anyone share on how some of these things will change since the first post?

Feb 26, 2009 06:28 AM