The fact that you have a foreclosure in your credit history doesn't necessarily mean you can't buy a home, but you will need to wait a while after the foreclosure before you'll be able to qualify. Most mortgage lenders these days underwrite loans to either FHA or Fannie Mae lending guidelines, and both types of financing require that you wait a certain amount of time before you can qualify.
Foreclosure Waiting Period for Fannie Mae Financing
Fannie Mae requires a standard waiting period of seven years after a foreclosure. In other words, once the foreclosure is complete, you'll need to wait at least seven years before you can get a Fannie Mae conventional loan.
It's possible that you can get this waiting period reduced, but only if you can document significant extenuating circumstances beyond your control that led directly to the foreclosure. Understand that this isn't always easy to accomplish because what is considered "extenuating circumstances" can be pretty subjective.
Many banks today prefer not to deal with loans that fall into gray areas in the guidelines because they don't want to be forced to buy back the loan because of a difference in opinion over what constitutes "extenuating circumstances".
However, if circumstances well beyond your control did indeed lead to the foreclosure, it might be worth seeing if you can get your loan approved. It will not be an easy process, but you may be able to make it work.
Foreclosure Waiting Period for FHA Loans
FHA guidelines are less strict than Fannie Mae guidelines, so the foreclosure waiting period is just three years. FHA also allows for a reduction in the waiting period for extenuating circumstances, but again, many banks may choose just to stick with the standard three-year waiting period.
Conclusion
If you have a foreclosure in your credit history and you're within the waiting period for FHA and Fannie Mae loans, it's a good idea to start working on reestablishing your credit right away. Always pay everything on time, clear up any negative credit items, and pay down and eliminate debt. Once the waiting period is up, your credit will be in the best shape it can be, which will make it that much easier to get a great loan.
Note that what is presented here is just a very general overview. Lending guidelines can change at any time and other guidelines may apply to your particular situation.
Foreclosure Waiting Period for Fannie Mae Financing
Fannie Mae requires a standard waiting period of seven years after a foreclosure. In other words, once the foreclosure is complete, you'll need to wait at least seven years before you can get a Fannie Mae conventional loan.
It's possible that you can get this waiting period reduced, but only if you can document significant extenuating circumstances beyond your control that led directly to the foreclosure. Understand that this isn't always easy to accomplish because what is considered "extenuating circumstances" can be pretty subjective.
Many banks today prefer not to deal with loans that fall into gray areas in the guidelines because they don't want to be forced to buy back the loan because of a difference in opinion over what constitutes "extenuating circumstances".
However, if circumstances well beyond your control did indeed lead to the foreclosure, it might be worth seeing if you can get your loan approved. It will not be an easy process, but you may be able to make it work.
Foreclosure Waiting Period for FHA Loans
FHA guidelines are less strict than Fannie Mae guidelines, so the foreclosure waiting period is just three years. FHA also allows for a reduction in the waiting period for extenuating circumstances, but again, many banks may choose just to stick with the standard three-year waiting period.
Conclusion
If you have a foreclosure in your credit history and you're within the waiting period for FHA and Fannie Mae loans, it's a good idea to start working on reestablishing your credit right away. Always pay everything on time, clear up any negative credit items, and pay down and eliminate debt. Once the waiting period is up, your credit will be in the best shape it can be, which will make it that much easier to get a great loan.
Note that what is presented here is just a very general overview. Lending guidelines can change at any time and other guidelines may apply to your particular situation.
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