The Buyer’s are Back! The waiting period after a short sale or foreclosure has been trimmed!
What a difference a couple of weeks makes! Interest rates have stabilized and are staying around 4.5%, housing prices have stabilized as well, but the BIG news if FHA is now allowing buyers to purchase a home 1 YEAR after a short sale, foreclosure, and/or bankruptcy!! This is huge news for buyer’s who were caught up in the last real estate bubble, and had to let their houses go.
Borrowers who experienced a foreclosure previously had to wait at least three years before getting a chance to get approved for an FHA loan, but with the new guidelines, certain borrowers who lost their home as a result of an economic hardship may be considered after just 12 months!
There are restrictions, as noted by Albert Chavez of Summit Funding:
- 620 Minimum credit score
- 12 months perfect payment history after the “economic event” that let to the credit issue.
- Max ratios 31/43% NO EXCEPTIONS!
- Housing Counseling required
- Document delinquencies that were the result of the “economic event”
- At least 60 day escrow, as it is unknown how long FHA will take to provide the required letter of approval.
Sellers, this is great news for you as well! As it opens up a huge pool of buyer’s for your property. Do you know what your home is worth in today’s market? If you’re thinking of moving up to that bigger home, down-sizing as an empty-nester, or considering an investment property, get going and contact the Mode and Durham Team! We can do a free market analysis to determine your property’s worth. You may be surprised at how much equity you have!
As always, make sure you’re working with a trusted Realtor who knows your market, and is not charging you up front fees for this information.
Use our quick and easy site to get an instant value for your home! For a more accurate value, or to talk about getting your home on the market, give us a call at 916-405-5737 today!