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Life happens, and not always just as planned! No one intends to have a short sale, but after one most folks will eventually want to own another home. I am frequently asked how long exactly this will take.
There is no one size fits all rule, but when considering a short sale of your home, your safest bet is to be prepared you may be out of the market for about 3 years. This is what I generally advise my clients when they ask how long it will take before they can buy again.
With that said, in some cases the road to owning a home again may even be much faster, or even immediate!
WAITING PERIOD FOR A NEW HOME LOAN AFTER A SHORT SALE:
Conventional Loans (Fannie Mae & Freddie Mac):
- 4 years
- 2 years with a qualifying extenuating circumstance
- 3 years
- No waiting period if there was no default on the mortgage at the time of the short sale, and all payments were made on time for 12 months prior.
- 2 years
- No waiting period if there was no default on any federal loan, and the lender does not find that the homeowner took advantage of the market
- 3 years
- No waiting period if the applicant was current at the time of short sale, (or in the case of divorce at time of divorce), and all debt payments were made on time for 12 months prior.
Re-establishing credit and meeting other lending guidelines will also be necessary. These guidelines cover most mainstream loans, and some lenders may offer more flexible portfolio loan products. Your best bet as always is to talk to an experience local CT mortgage professional, like Lynne Oliveri of First World Mortgage 860.989.8008, who fact checked these guidelines for us!