After a foreclosure, how long do I have to wait to buy another property?
Q: How long do I have to wait after a foreclosure to buy a property?
A: There is no wait to "buy a property" per se, as you can always pay with cash. However, if you need financing, the answer is "it depends." If you walked away from your last home it could take as long as seven years for you to again be eligible for a new mortgage from Fannie Mae or Freddie Mac, but recent changes after the housing market meltdown may shorten that time considerably.
Fannie Mae, Freddie Mac guidelines
If your foreclosure was the result of "Extenuating Circumstances," this waiting period could be as short as only three years for a Fannie or Freddie-backed loan, according to guidelines outlined in Fannie Mae Announcement SEL-2010-08 ("Underwriting Borrowers with a Prior Foreclosure"), but you'll need to come up with a 10 percent down payment, and your credit of course will need to be solid.
If the foreclosure was through no fault of your own -- you had a drop in income, job loss, etc. -- the FHA has instituted a "Back to Work" program where there may be a relatively short waiting period of perhaps a year.
To be eligible for this program, you'll have to been beset upon by an "economic event" which resulted in a loss of income of 20 percent or more for at least six months... and you'll have to have re-established credit for a minimum of 12 months (foreclosure has cleared, and no other derogatory incidents over that time span).
You'll also have to take a HUD-approved housing counseling course.
More help from HSH.com
Advantages of a FHA mortgage in 2017FHA loans have become more affordable in 2015, thanks to a drop in the annual mortgage insurance premium that the Federal Housing Administration charges.
Streamline Refinance Program to Replace HARPThe HARP refinance program for troubled or underwater homeowners will come to an end in 2017, but a new streamline refinance program will takes its place.
Flex Modification: An outline of HAMP's replacementThe Making Home Affordable Home Affordable Modification Program comes to an end on December 31, 2016, but is being replaced by a new Flex Modification program from Fannie Mae and Freddie Mac.
HSH.com’s yearly outlook: 2017 - Nine forecasts and outlooksAt the start of each year, HSH.com details the important factors we think are most likely to influence the mortgage and real estate markets in the coming year.
HSH.com on the latest move by the Federal ReserveThe Federal Reserve concluded a meeting today with no change to the federal funds rate and no changes to other monetary policy tools.