4 years with a down payment of at least 10%.2 years with a minimum 20% down payment.If the borrower was not behind on mortgage payments and installment debts at the time of the short sale and for 12 months preceeding the short sale, there may be no waiting period.įHA tends to be a popular option as the minimum down payment is currently 3.5% and FHA is more forgiving with credit than Fannie or Freddie.įannie Mae has various wait periods depending on loan to value: Washington state home owners hoping to avoid a foreclosure, opted to try the short sale route.Ī question I am being asked more and more is: “ Who soon can we buy our next home after having a short sale?” The answer depends on a few factors.įHA has a three year wait period for borrowers who were in default at the time of the short sale (or pre-foreclosure sale). Short sales became more common over the past few years following the mortgage crisis. In order for a short sale to take place, the lien holders on the property agree to being “shorted” on the amount owed to them for the deed of trust or mortgage. Conventional guidelines now require a 4 year wait period regardless of how much down payment a borrower has.Ī Short Sale, also referred to as a pre-foreclosure, is when a home owner sells their home for a lower amount than what is owed on the property with mortgages (deeds of trust). The foreclosure moratorium on these loans has been extended through June 30, 2021.EDITORS NOTE : Conventional guidelines have changed since the writing of this post. This additional six months increases the maximum amount of time homeowners that are currently in forbearance to up to 18 months.
With those loans, if you’re currently in forbearance you may now qualify for an additional six months of forbearance, in 180 day increments. If you have a VA loan, USDA loan, or FHA loan, you have until Jto request your initial forbearance. 28, 2021, you may remain in forbearance for only up to 12 months. For initial forbearance claims made after Feb.
While the deadline for the maximum, 18-month COVID-19 forbearance has already passed, loans backed by Fannie Mae and Freddie Mac are still eligible for a reduced forbearance. If you’re unsure what options are available to you, here are the updated deadlines to request a COVID-19-related forbearance for each type of mortgage. You can also use the Fannie Mae or Freddie Mac tools to look up your mortgage, but those tools won’t include USDA loans, FHA loans or VA loans. If you’re unsure what type of mortgage you have, call your loan servicer. Keep in mind that you may still have a loan that qualifies for forbearance - even if you have a private lender. But many private lenders are offering forbearance, so call your loan servicer and ask even if you don’t have a government-backed loan. If you have a private mortgage, then these moratoriums won’t apply to you. The new forbearance and foreclosure deadlines apply only to loans backed by a federal agency, Fannie Mae, or Freddie Mac. Here’s what you need to know about your options for entering and exiting forbearance. Talking with your loan servicer will help you to understand all of the available options. “If you’re experiencing any kind of hardship, call your servicer, right off the bat,” says Federal Housing Finance Agency press secretary Raffi Williams. So it’s important to talk with your loan servicer. Even if you don’t have a federally-backed mortgage, your loan servicer may have forbearance options available for you.Īlso, with these new rules, you won’t automatically be placed in forbearance or have your forbearance automatically extended. If you’re struggling to make your mortgage payment, contact your loan servicer.
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