When Can I Buy Again?

How Long Will it Take To Buy Again After:

Christian Durland NMLS#269348 | Colorado Loan OfficerA Bankruptcy, Short Sale, Foreclosure and Deed in Lieu.

Updated 2014 Guidelines!

 

Conventional Conforming – Eligibility Determined by Application Date (need AUS approve/eligible)

Derogatory Item Waiting Periods:

Foreclosure

Foreclosure: Home was give back to the lender — No owner participation, done with legal proceeding.

  • Seven (7) years from date foreclosure completed and transferred back to lender to date of credit report.
  • Three (3) years from foreclosure date with approved and qualified extenuating circumstances.

Short Sales

Short Sale and Deed in Lieu of Foreclosure
Short Sale: Lender agreed to accept payoff for less than owed.
Deed in Lieu: Borrower, failing to satisfy the loan obligation, assigns title to lender and avoids foreclosure proceedings.

  • Seven (7) years from date of sale closed and transferred to new owner for less than 10% down payment of purchase of primary residence.
  • Four (4) years from date of sale closed and transferred to new owner for 10% down payment on purchase of primary residence.
  • Two (2) years from date of sale closed and transferred to new owner with a 20% down payment on a purchase of primary residence.
  • Two (2) years from date of sale closed and transferred to new owner with acceptable extenuating circumstances and 10% down payment on purchase of primary residence.

Chapter 7

Bankruptcy Chapter 7:  Debts are discharged through BK — Client does not pay any debts owing.

  • Four (4) years from discharge date with re-established credit with no derogatory ratings.
  • Two (2) years from discharge date possible with extenuating circumstances.

Chapter 13

Bankruptcy Chapter 13:  Debts are paid back on a monthly scheduled payment plan by client.

  • Two (2) years from discharge date.
  • Four (4) years from dismissal date.
  • Two (2) years from discharge or dismissal date with extenuating circumstances.

Credit must be re-established with a 680 minimum credit score

VA Eligibility Determined By Date of Loan Approval

Derogatory Item Waiting Periods:

Foreclosure

Foreclosure,Deed in lieu of Foreclosure,Bankruptcy:
Foreclosure: Home was given back to the lender — No owner participation, done with legal proceeding.
Deed in Lieu: Home returned to lender in exchange for canceling loan.

  • Two (2) years from date foreclosure completed and transferred back to lender.
  • Twelve (12) to Twenty Three (23) months from date foreclosure completed and transferred back to lender if credit re-established and paid as agreed and was caused by acceptable extenuating circumstances such as unemployment, prolonged strikes, medical bills not covered by insurance. Divorce does not qualify.

Short Sale

Short Sale: Lender agreed to accept payoff for less than owed.

  • Two (2) years from date sale closed and transferred to new owner.

Chapter 13

Bankruptcy Chapter 13 or Consumer Credit Counseling: Debts are paid back on a monthly scheduled payment plan by client.

  • Eligible within One (1) year payout period under Chapter 13 bankruptcy or consumer credit counseling has elapsed, the payments are included in the debt ratios, borrower has a satisfactory credit rating, all payment shave been made on time and the borrower receives bankruptcy court approval to enter into the mortgage transaction.

Credit must be re-established with a 620 minimum credit score

FHA Eligibility Determined By Date Of Loan Approval

Derogatory Item Waiting Periods:

Foreclosure


Foreclosure, Deed in lieu of Foreclosure
Foreclosure: Home was given back to the lender — No owner participation, done with legal proceeding.
Deed in Lieu: Home returned to lender in exchange for canceling loan.

  • Two (2) years from date foreclosure completed and transferred back to lender.
  • Less than two (2) years, but not less than twelve (12) months from date foreclosure completed and transferred back to lenders, may be acceptable with extenuating circumstances, such as death/serious illness of a wage earner and re-established good credit. Divorce or inability to sell home because of job transfer or relocation does not qualify.   NOTE:  FHA’s new Back to Work Program now allows a job loss to be included as an extenuating circumstance, as long as the loss of employment/income was out of the borrower’s own control.  CLICK HERE for more info on the Back to Work Program

Short Sale

Short Sale: Lender agreed to accept payoff for less than owed.

  • Three (3) years from date sale closed and transferred to new owner.
  • No waiting period if borrower had no late payments on any mortgages and consumer debts within the 12 months preceding the short sale; AND, they are not taking advantage of declining market conditions to purchase another home; AND, the proceeds from the short sale serve as payment in full.

Chapter 7

Bankruptcy Chapter 7: Debts are discharged through BK, client does not pay any debts owing.

  • Two (2) years from date of discharge with re-established credit with no derogatory ratings; in lieu of re-established credit, credit letters covering the past 12 months from two alternative credit sources (e.g., telephone, cable, gas or electric companies) are required before purchasing.

Chapter 13

Bankruptcy Chapter 13 or Consumer Credit Counseling: Debts are paid back on a monthly scheduled payment plan by client.

  • Eligible with one (1) year payout period under Chapter 13 bankruptcy or consumer credit counseling has elapsed, the payments are included in the debt ratios, borrower has a satisfactory credit rating, all payments have been made on time and the borrower receives bankruptcy court approval to enter into the mortgage transaction.

Credit must be re-established with a 640 minimum credit score

USDA Eligibility Determined By Date Of Loan Approval

Derogatory Item Waiting Periods:

Foreclosure

Foreclosure, Deed in lieu of Foreclosure
Foreclosure: Home was given back to the lender — No owner participation, done with legal proceeding.
Deed in Lieu: Home returned to lender in exchange for canceling loan.

  • Three (3)  years from date foreclosure completed and transferred back to lender.

Short Sale

Short Sale: Lender agreed to accept payoff for less than owed.

  • Three (3) years from date sale closed and transferred to new owner.

Chapter 7

Bankruptcy Chapter 7: Debts are discharged through BK, client does not pay any debts owing.

  • Three (3) years from date of discharge with re-established credit with no derogatory ratings; in lieu of re-established credit, credit letters covering the past 12 months from two alternative credit sources (e.g., telephone, cable, gas or electric companies) are required before purchasing.

Chapter 13

Bankruptcy Chapter 13 or Consumer Credit Counseling: Debts are paid back on a monthly scheduled payment plan by client.

  • Three (3) years from date of discharge with re-established credit with no derogatory ratings; in lieu of re-established credit, credit letters covering the past 12 months from two alternative credit sources (e.g., telephone, cable, gas or electric companies) are required before purchasing.

Credit must be re-established with a 640 minimum credit score

NOTE:  Extenuating circumstances are non-recurring events that are beyond the borrower’s control that result in a sudden, significant, and prolonged reduction in income or a catastrophic increase in financial obligations.

Christian Durland NMLS#249348 | Colorado Loan OfficerChristian Durland NMLS#269348 I've been in the Mortgage Industry since 2002. Since theres no one size fits all solution, my team and I focus on understanding each clients unique short and long-term financial goals, and then recommending the optimal financial instrument (mortgage), whether its for a new home purchase or refinance.
I've established a strong network of professionals within the Real Estate and Financial Services Communities to provide the valuable resources necessary for our clients to be financially successful.