Life after a BK, Foreclosure, and Short Sale. How long do you have to wait to buy your next home?

“Yesenia, how long do I have to wait before I can buy a home again?”
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This is a question that I get asked almost on a daily basis. You’ve made it through the storm; you filed for Bankruptcy, you went through a Foreclosure, sold your home in a Short Sale, or maybe you were lucky enough to get a Loan Modification and now you are ready to sell your house and move to a different neighborhood but don’t know if you’ll qualify to buy the next place? My friends over at Pinnacle Mortgage have put together these handy charts that give you the break down on time frames based on what kind of financing you are looking to obtain and based on whether you went through a BK (chapter 7, 11, or 13), Foreclosure, or if you did a short sale.

2015-09-15 10_38_34-Shortsale-Foreclosure timelines

2015-09-15 10_38_50-Shortsale-Foreclosure timelines

As you can see, there is a difference between the requirements or guidelines of FHA vs Conventional vs VA financing. There are also exceptions that are sometimes made based on extenuating circumstance. To be eligible for the reduced seasoning time due to extenuating circumstances borrowers must have re-established credit for 2 years and provide letters of explanation and documentation evidencing the incident was not due to financial mismanagement (aka you just didn’t feel like paying on a house that wasn’t worth what you owed on it). Here are some examples of acceptable situations:

  • Death of primary wage earner
  • Long-Term illness or disability not covered by insurance
  • Prolonged loss of employment for reasons beyond borrower’s control (ex. closing mergers)

Where Do I Start?

The best way to see if you are ready to purchase your next home is to give us a call so we can set up an appointment with one of our lending partners who will sit down with you and go over your specific situation. Best case scenario is that you have already fulfilled the lender’s seasoning requirement and are ready to start looking for your house! Worst case scenario? our lending partner will be able to sit down with you and write out a plan of action so that while we are waiting for the seasoning requirement to be met we can also be working on other factors such as your credit, outstanding debt, and income.

Give us a call or shoot me an email and we can start working on getting you into your new home!

Direct: (626) 252-0839




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