FHA loan short sale waiting period
FHA loan waiting period after short sale
After the credit crisis of 2008 qualifying for a mortgage became a lot harder. If not for FHA many borrowers would not qualify for a mortgage. What makes FHA different than a conventional loan is the FHA will approve you and give a better interest rate with a lower down payment even if you have a low credit score.
When you compare FHA vs. conventional loans FHA loans win the down payment and credit score race hands down. FHA loans only requires a minimum down payment of 3.5 percent of the purchase price with a 580 credit score versus a conventional loan requiring between 5 to 20 percent down payment with a minimum 620 credit score.
The average credit score for an FHA loan is 680 well above FHA’s minimum credit score of 580 for 3.5% down payments, according to HUD.
FHA guidelines lets you qualify for a loan after three years from a
short
sale. FHA guidelines requires a minimum three year past from the date of sale of
the property. You will need to document when the lender sold the
property after they took possession of the property.
FHA guidelines for short sale allows borrowers with a minimum credit score of 500 qualify for a FHA loan. After a short sale, above 580 credit score and three years past the sale date FHA allows only 3.5% down payment.
FHA "Back To Work" Loan - Rules & Guidelines
Borrowers with a prior bankruptcy, foreclosure, deed-in-lieu, or short sale may be eligible for an FHA insured loan if the bankruptcy, foreclosure, deed-in-lieu, short sale was the result of a documented extenuating circumstance.
New FHA loan requirements borrowers may also be eligible for an FHA insured loan on a purchase transaction after 12 months from the completion, discharge, trustee's sale if the borrower meets the requirements for extenuating circumstances Economic Event.
Credit score
January 20, 2010 - New FHA announced a policy change to address risk and strengthen finances. FHA has changed the minimum credit score for new borrowers:
FHA loan short sale waiting period
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FHA Short Sale Guidelines
FHA guidelines requires three year past from the date of sale of the property
or
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FHA Credit Score
Requires a minimum credit score of 500 to buy a home or refinance
Collection accounts
A collection is minor in nature usually does not need to be paid off as a condition for loan approval
Bankruptcy
Chapter 7 Bankruptcy at least two years must have elapsed since the discharge date
Foreclosure
Foreclosure must have been resolved for at least 3 years
Short Sale
FHA guidelines requires three year past from the date of sale of the property
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