The housing market has been fraught with financial woes in the last few years. Many homeowners have faced the plummeting values of their homes, as well as being upside down with their mortgages. Foreclosures and short sales do not have to spell disaster for the typical homeowner. There is life after a short sale.
As the market appears to show some nascent sign of life, many homeowners are wondering what their chances are of qualifying for a mortgage after a short sale. Recommended are determination, above-average credit and not losing sight of the dream of ownership. According to some real estate experts, it is a common belief that those who walked away from their home with a short sale, may find it easier than expected to qualify for a loan further down the line.
After going through a short sale, the average waiting time to requalify could be from two to seven years and contingent upon the amount one can put down. Variables include the type of loan one seeks, as well as whether or not the loan is for a U.S. Veteran. Qualifying for a federal loan seems to be the most expeditious route to go, but the buyer should be ready to answer questions about the reasons for a short sale. Less-risky choices for a lender point towards non-financial variables such as job transfers above walking away from an upside-down mortgage.
Having a second chance involves paying off debt and saving money for a down payment. Efforts can pay off with a low interest rate and reasonable loan-length. One expert cautions that errors on credit reports must be corrected so the borrower is not saddled with the stigma of a short sale. Incorrect information on a credit report will add waiting time to the process. Recommendations are to keep meticulous records and documents and watch the calendar. Seven years can go by all too quickly. Your second chance at owning a home in Texas might be just around the corner.
Source:chron.com, “It’s possible to get a mortgage after a short sale” Polyana da Costa, Dec. 05, 2013