Fannie Mae Guidelines After A Housing Event On Conventional Loans

This article covers Fannie Mae Guidelines After A Housing Event On Conventional Loans

The Fannie Mae Guidelines After A Housing Event On Conventional Loans require mandatory waiting period requirements.  Fannie Mae defines a housing event as one of the following:

• Foreclosure
• Deed in lieu of foreclosure
• Short sale

Homebuyers can qualify for a conventional loan after a foreclosure, deed in lieu of foreclosure, short sale after meeting the mandatory waiting period requirements. Lenders do expect borrowers to have no late payments after a housing event and re-established credit.

Difference Between The Three  Different Types Of Housing Events

Unlike FHA loans, Conventional loans classify housing events differently.

• The waiting period requirements are different depending on the type of housing event
• Fannie Mae has a longer waiting period after a foreclosure versus a deed in lieu of foreclosure and/or a short sale
• The waiting period after foreclosure to qualify for a conventional loan is seven years
• There is a four year waiting period after a deed in lieu of foreclosure and/or a short sale
• Therefore, the waiting period after a short sale and/or a deed in lieu of foreclosure is shorter than a standard regular foreclosure
• This is not the case with government loans. Government loans (FHA, VA, USDA) classifies all housing events the same
• The waiting period requirements after a foreclosure, a deed in lieu of foreclosure, or short sale is all the same
• A deed in lieu of foreclosure and/or a short sale is not given a shorter waiting period requirement on FHA, VA, USDA loans

In this article, we will discuss and cover the Fannie Mae Guidelines After A Housing Event On Conventional Loans.

Fannie Mae Guidelines After A Housing Event On Conventional Loans: When Is The Waiting Period Start Date

The waiting period start date clock starts the date the title has exchanged ownership.

• The waiting period start date is the date the homeowner’s name has been transferred out of the title and moved to the lender’s name
• It is not the date the homeowners have vacated the property
• The name of the deed needs to be transferred to the lender’s name and/or the new owner’s name or the date of the sheriff’s sale
• The same holds true with a deed in lieu of foreclosure
• The waiting period start date after a deed in lieu of foreclosure is not the date the homeowner surrendered the deed but rather it is the date the deed changed hands
• Often times the homeowner may have relinquished ownership but the lender did not take out the borrower’s name into their name
• If this happens, then the waiting period did not even start yet

The waiting period start date after a short sale is the date when the short sale closed.

Fannie Mae Guidelines After A Housing Event Waiting Period Requirement

There are mandatory waiting period requirements to qualify for conventional loans after a housing event:

• There is a seven-year waiting period after the recorded date of foreclosure to qualify for a conventional loan
• There is a four year waiting period after the recorded date of deed in lieu of foreclosure
• There is a four year waiting period after a short sale to qualify for a conventional loan

A prior foreclosure, deed in lieu of foreclosure, or short sale has no impact on mortgage rates on conventional loans.

Fannie Mae Guidelines After A Timeshare Foreclosure

A timeshare loan is not considered a real estate loan. Under Fannie Mae and Freddie Mac Agency Mortgage Guidelines, a timeshare is not a real estate loan.

• A timeshare is considered an installment loan
• Therefore, under Fannie Mae and Freddie Mac Guidelines, there are no waiting period requirements after a timeshare foreclosure to qualify for a conventional loan
• However, most lenders still consider a timeshare foreclosure as a real estate foreclosure and will require waiting period requirements as part of their lender overlays
• Many lenders require a waiting period after a timeshare foreclosure just like a regular foreclosure
• Gustan Cho Associates is a national mortgage company licensed in multiple states with no lender overlays on government and conventional loans

Gustan Cho Associates has no waiting period after a timeshare foreclosure to qualify for a conventional loan.

Waiting Period Guidelines With A Prior Mortgage Included In Bankruptcy

Borrowers with a prior mortgage included in bankruptcy can qualify for a conventional loan after four years from the discharged date of the bankruptcy.

• The waiting period requirements starts from the date of the bankruptcy discharged date
• The foreclosure can happen after the discharged date and has no impact on the waiting period
• The borrower cannot have reaffirmed the mortgage after bankruptcy
• Lenders expect timely payments and re-established credit after the bankruptcy
• With FHA loans, if the borrower had a prior mortgage included in the bankruptcy, the waiting period start date is the date of the finalized housing event
• There is a three year waiting period from the waiting period start date after the housing event to qualify for an FHA loan

The discharged date of bankruptcy does not matter.

Qualifying For A Mortgage After A Housing Event With A Lender With No Overlays

To qualify for a home mortgage with a national mortgage company licensed in multiple states with no lender overlays on government and conventional loans, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com. Gustan Cho Associates has zero lender overlays on FHA, VA, USDA, and conventional loans.  The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.