Home Ownership After Foreclosure, Short Sale, Bankruptcy; When Can I Buy Again?
"DREAM" IT'S THE AMERICAN WAY!
Are these questions running through your head?
OR
Have you simply put them out of your mind?
Can I buy a home again in this lifetime?
Is the dream of Home Ownership over for me?
How long will I have to wait to get a home loan?
I had my chance; they aren't going to give me another one, or will they?
Yes they will, it's just a matter of when!
WAITING PERIOD (Your time to rebuild)
FORECLOSURE: If you have a "Foreclosure" looming on your credit your "time to rebuild" is 3 years!
SHORT SALE: If you sold your home in a "Short Sale" you have 2 years to rebuild if your payments were delinquent. If you were not delinquent in your payments, your time is now!
BANKRUPTCY: With a "Bankruptcy" you have 4 years to rebuild unless it was a Chapter 13 (reorganization) in which case you have 3 years to rebuild.
DEED IN LIEU OF FORECLOSURE: With a "Deed in Lieu of foreclosure" you will have 4 years to rebuild and possibly only 2 if there are extenuating circumstances.
Certainly not as bleak as many of us would have believed!
Begin your process by holding on to your job, cleaning up your debt to income ratio and banking for a down payment. Your dream really can come true and I will be here to help you through, answering questions and pointing you to the right professionals to help you gain that pre-approval!
If you want something, giving up will never get you there! As american's we are tougher than that and can accomplish all of our dreams with a plan of action and good old fashioned determination!
Changes effective July 1, 2010
Sandi Andrews of Mortgage Master Inc. has just delivered the following updates to me!
PLEASE READ FOR THE MOST CURRENT CHANGES...
Advising Foreclosure, Short Sale and Deed-in-Lieu Clients
If you are working with a client who has had a short sale or a deed-in-lieu in their past, or you are listing a home and your sellers may have the same issues, FannieMae announced new waiting periods, as of July 1, 2010, before being eligible for another loan. The waiting period is defined as "from the date of the pre-foreclosure to the date of application". These policies favor borrowers that work with their servicers to avoid Full Foreclosure either by Deed-in-Lieu, Pre-foreclosure Sale, or Short Sale.
· Fannie defines ALL Pre-foreclosures as any one of the following three event types:
o Deed-in-Lieu
o Preforeclosure Sale
o Short Sale
· Full Foreclosure - Current applications wait 5 yrs;
As of applications dated October 1, 2010 - 7 yrs
New Waiting Periods Effective for July 1, 2010 Applications
|
Pre-foreclosure Event |
Current Waiting Period Requirements |
New Waiting Period Requirements for all three event types |
|
Deed-in-Lieu of Foreclosure |
4 years Additional requirements apply after 4 years up to 7 years |
· 2 years - 80% maximum LTV ratios · 4 years - 90% maximum LTV ratios · 7 years - Standard LTV ratios
|
|
Pre-foreclosure Sale |
2 years |
|
|
Short Sale |
No specific policy currently exists |
|
|
For extenuating circumstances, for all 3 event scenarios, it's a 2-year waiting time and 90% LTV |
Waiting Periods for Other Derogatory Events
Ever wonder how long your clients have to wait to apply for another loan after they've filed Bankruptcy? Here are the rules, so you can advise prospect/clients and not waste your time if they don't meet these requirements!
What's an "Extenuating Circumstance"? If your clients had a job loss, major medical bills, an accident, etc., then they don't have to wait as long. However, documentation is critical, as clients have to PROVE they had financial difficulties BEYOND their control.
|
Derogatory Event |
Waiting Period Requirements
|
Waiting Period with Extenuating Circumstances |
|
Bankruptcy - Chapter 7 or 11
|
4 years
|
2 years
|
|
Bankruptcy - Chapter 13
|
2 years from discharge date 4 years from dismissal date
|
2 years from discharge date 2 years from dismissal date
|
|
Multiple Bankruptcy Filings
|
5 years if more than one filing within the past 7 years
|
3 years from the most recent discharge or dismissal date
|
|
Foreclosure
|
7 years
|
3 years * Additional requirements after 3 years up to 7 years: · 90% maximum LTV ratios · Purchase, principal residence · Limited cash-out refi, all occupancy types
|
|
The maximum LTV ratios permitted are the lesser of the LTV ratios in this table or the maximum LTV ratios for the transaction per the Eligibility Matrix. |
I want to be there to assist you in making your "Dreams Come True"!
Serving Windham County, CT
Abington Ashford Ballouville Brooklyn Canterbury Chaplin Danielson Dayville Eastford Fabyan Grosvenor Dale Hampton Killingly Ledyard Moosup North Grosvenor Dale Norwich Oneco Plainfield Pomfret Putnam Quinebaug Rogers Scotland Staffordville Sterling Thompson Wauregan Willimantic Windham Woodstock
Serving New London County, CT
Ashburnham Athol Auburn Barre Berlin Blackstone Bolton Boylston Brookfield Charlton Clinton Douglas Dudley East Brookfield Fitchburg (city) Gardner (city) Grafton Hardwick Harvard Holden Hopedale Hubbardston Lancaster Leicester Leominster (city) Lunenburg Mendon Milford Millbury Millville New Braintree North Brookfield Northborough Northbridge Oakham Oxford Paxton Petersham Phillipston Princeton Royalston Rutland Shrewsbury Southborough Southbridge Spencer Sterling Sturbridge Sutton Templeton Upton Uxbridge Warren Webster West Boylston West Brookfield Westborough Westminster Winchendon Kathy Chase, Realtor Keller Williams Realty www.CTHomeLocator.com
JCKC Realty Team Specialist
860-942-9212
kathychase@jckcrealty.com
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