Life after a short sale is going to be different for everyone. The two of the most common questions that arise are:
When will I be able to buy a home again?
What is this going to do to my credit?
As of December 16th, 2009, the Federal Housing Administration guidelines say that homeowners may purchase again if:
- the borrower is current with there mortgage at the time of the short sale.
- the proceeds of the short sale serve as payment in full.
Borrowers may not qualify for a new FHA mortgage if:
- it seen as simply taking advantage of a down market
- the purchase is at a reduced price for a similar or superior property within a reasonable commuting distance.
For more information, click here.
For short sale sellers who did miss payments, they will be allowed to purchase again in 3 years from the date of the closing of their previous property. If you were to allow the property to go through foreclosure, this time frame will be 7 years.
As for your personal credit score after a short sale, this will all be depend on how many payments were reported as missed prior to closing on your short. These can be the most damaging to a score. After a short sale is completed, I recommend that my sellers have a free consultation with a credit repair company.