Opportunity to get a loan after a short sale will get tougher August 16th. Recently Fannie Mae announced that as of August 16, 2014 the waiting period after a short sale or deed in lieu of foreclosure will increase from 2 to 4 years ! That means anyone with a short sale in their past will have to wait an additional two years before being eligible for a loan to purchase or refinance a home or investment property. Currently there is a staggered waiting period that allows the homeowner to obtain a new Fannie Mae conventional loan as little as two years after the completion of a short sale. The down payment or equity required is 20% and have established a good credit history since the short sale. That will all change August 16th when that waiting period jumps to four years. The silver lining is after the four-year waiting period a borrower will have available all of the standard underwriting guidelines for Fannie Mae, including the ability to finance a home with as little as 5% down. There is still an exception for extenuating circumstances but documentation of such circumstances can be tough. I have not found any indication from Freddie Mac how their requirements might change but it is something to watch. If you or a client are in the market for a new home, or would benefit from a refinance and had a short sale more than two years ago as of mid August – it would be very important to get started with the new loan right away. Signet Mortgage Corporation is uniquely positioned to assist with financing of your property and figuring out the possibilities available to you. Signet is licensed in five western states. Call us today and let’s talk.
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