Qualifying For FHA Loan After Foreclosure

Qualifying For FHA Loan After Foreclosure Guidelines

Qualifying For FHA Loan After Foreclosure is now possible for home buyers who meets the mandatory waiting period after foreclosure. Fannie Mae and Freddie Mac are the two mortgage giants that are in charge for setting standards and mortgage lending guidelines on Conventional Loans. Fannie Mae and Freddie Mac categorizes foreclosure and deed in lieu of foreclosure into two separate categories and the waiting period differs between the two. The mandatory waiting period to qualify for a conventional loan after the recorded date of a foreclosure is seven years. The mandatory waiting period to qualify for a conventional loan after the recorded date of a deed in lieu of foreclosure is four years. However, FHA classifies foreclosures and deed in lieu of foreclosures into the same category. The mandatory waiting period in qualifying for FHA Loan after foreclosure is three years from the recorded date of the foreclosure which is reflected by the date of the sheriff’s sale or when the deed of the property was transferred out of the homeowners name into the name of the lender and has been recorded on public records. The mandatory waiting period in qualifying for FHA Loan after a deed in lieu of foreclosure is the same as the waiting period in qualifying for FHA Loan after foreclosure, which is three years.

Qualifying For FHA Loan After Multiple Foreclosures

Many folks invested in real estate prior to the 2008 real estate and mortgage meltdown. Real estate values were escalating and appreciating double digits year after year. The real estate market was hot and lending was easy. No doc loans and sub prime mortgages were the name of the game and it was very difficult not to make money investing in real estate. Then the big real estate crash came like a major hurricane in 2008 where hundreds of thousands, if not millions, of real estate investors not just lost their real estate investment portfolio but also ended up losing their personal homes. There are so many folks who have multiple foreclosures. I have many mortgage loan borrowers who are looking to become homeowners again but have multiple foreclosures. You can qualify for FHA Loans after multiple foreclosures. How this works is the waiting period applies to all foreclosures. Whether it is one property or ten properties that a person had in the past, it does not matter. FHA will go off the last foreclosure that was recorded. For example, if a mortgage loan borrower had three properties and here are when these properties foreclosed:

  1. Property A foreclosure on 2/13/2010
  2. Property B foreclosure on 2/14/2011
  3. Property C foreclosure on 2/15/2013

The above borrower had three foreclosures and needs to qualify for a FHA Loan. Qualifying for FHA Loan after foreclosure requires a mandatory waiting period of three years from the recorded date of foreclosure which is reflected and recorded on public records. With the above example, the latest foreclosure recorded was with Property C which the recorded date was on 2/15/2013. Property A and Property B already met the 3 year mandatory waiting period. Property C, the waiting period is over on 2/15/2016.  This person will qualify for a FHA loan on or after 2/15/2016.

Qualifying For FHA Loan After Foreclosure With Late Payments

FHA mortgage lenders do not want to see any late payments by mortgage loan borrowers after foreclosure. Late payments after foreclosure is not a deal killer but most mortgage lenders will not approve borrowers with FHA Loan After Foreclosure with late payments. I can help home buyers who had late payments after foreclosure. One of two late payments is not an issue, however, if you have a series of late payments after foreclosure, you may need to go through a credit repair program to try to get the derogatory credit items removed from your credit report. If you have late payments after foreclosure, please contact me at 262-716-8151 or email me at gcho@gustancho.com. I will be able to help you in getting you a FHA Loan.

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

Comments are closed.