How Long Do I Have to Wait to Buy a House After a Short Sale?

The answer to this question varies depending on the loan program a buyer is looking at, but most buyers who have past credit problems rely on FHA loans as their fastest track back to homeownership.  This is due to FHA’s lenient credit guidelines compared to conventional loan programs.  UPDATED: For guidelines on other programs, please scan to the bottom of this page.


HUD (The Department of Housing and Urban Development) just released updated guidelines on the very topic on December 16th, 2009 in their Mortgagee Letter 09-52.  This mortgagee letter specifically covers FHA guidelines for buyers who have sold their property for less than what they owed.

The new FHA guidelines say a buyer cannot buy for 3 years if they were delinquent on their previous loan leading up to the short sale.  This timeline is identical to FHA guidelines on a foreclosure.

The guidelines do say a homebuyer can buy immediately following a short sale IF they were current on their mortgage and other installment debt payments at the time of their short sale and if the proceeds from the short sale were accepted as a payment in full.  In other words, if you were not late and the bank accepted your sale, you can buy again.

HUD does say that you cannot buy using a FHA loan if the purpose of the short sale and new purchase were done to take advantage of declining market conditions or to purchase a similar or superior property at a reduced price.  In other words, don’t abuse the guidelines to get a better deal.

To sum up the guidelines, you can buy immediately after a short sale but you cannot have been late on your loan and you can’t buy if your short sale was done to benefit from current market conditions.  Which scenarios would this apply to?  Here’s a few that would fit the requirements:

  • You are forced to move do to a new job and location.  You have to sell your home and you owe more than it’s worth.
  • You cannot afford to keep your home, such as losing your job, and were able to sell your home before becoming late on the home loan payments.  You then buy again when you have a new job and can afford the payments
  • You have a balloon payment due and cannot afford the payment.  You sell for less than what you owe due to market conditions and later buy.

Here are the seasoning requirements for all programs:

FHA- 3 years. Circumstances allow less than 3 years if the homeowner wasn’t late during the shortsale or circumstances were outside the homeowners control.…

Conventional- 2 years with 20% down, 4 years with 10% down or 7 years with no restrictions This is on page 451 of the Fannie Mae seller guide-

VA- 2 years as the VA states they treat foreclosures the same as bankruptcies for seasoning. Short sales aren’t bankruptcies but since the VA reviews mortgage history in the last 2-years very closely, I don’t see them releasing updated guidelines other than adding verbiage stating short sales are included.
Chapter 4 of the VA handbook

USDA- 3 years unless USDA’s underwriting engine (GUS) approves you sooner. Typically 2-years with re-established credit. The USDA handbook has specific guidelines for debt that is paid off for less than what is owed, which a defaulted short sale falls under. I’ve found that GUS typically approves a client after 2-years of re-established credit but sometimes sooner.
Chapter 4 of the rural housing handbook

98 comments to How Long Do I Have to Wait to Buy a House After a Short Sale?
  • I re-posted your article. Thanks Keane for being on top of the pertinent information we need to be successful!

    Thanks Nancy!

  • David

    The question is whether any banks are allowing you to get into a short sale without being delinquent? Everyone we’ve talked to who has tried this has been told (by different lenders) that they will not be eligible for a short sale until they are delinquent in their payments. Seems like a catch-22 if that’s the case.

  • David,

    You’re absolutely right. It is a catch 22.

    The key is to show a level of hardship. The lenders assume they shouldn’t allow a lower amount until they know you’re serious.

    The only times I hear it works is when you can show the hardship prior to late payments. Divorce is a common one. It’s clear they need to sell the house and nobody wants it, with only one income.

    You’re right though, it’s rare. For those rare moments, it is nice there’s an option.

  • Tom

    David is correct. It’s definitely a Catch 22. I was getting my second mortgage payments debited automatically from my bank account thoughout the life of my loan (and of course never missed a payment). During the short sale (SS) process, my lender did not take out my scheduled payment in order for the SS to get approved. So now I have a thirty day late on my record. I settled with my lender after the SS, but that’s not going to allow me purchase a house for three years b/c of one thirty day late.

  • Debbie

    Does anyone know of a lender in Colorado or one that does loans for Colorado buyers that will do an FHA loan for a borrower that has done a short sale due to a divorce and wasn’t late on her payments?

  • Debbie,

    Based on your circumstances, you qualify. You shouldn’t have a hard time finding a lender. If you do, please let me know and I’ll help find one for you. I would recommend you talk to a direct FHA lender where the loan officer can talk to the underwriter directly before you shop to confirm you’re okay. That’s what I do when I have a scenario that needs some explaining.


  • Debbie

    Keane, Thanks for the direction. If I don’t find someone here myself, I’ll definitely recruit your help :-)

  • Debbie,

    No problem :) Most of the visitors to my blog aren’t in states I can serve, but this blog is for everybody. Let me know how it goes. Even if I can’t help you, I can hopefully help you find someone.


  • DJM

    Thanks for the information. I had to short sale my home in NC a year ago when my job moved me to Ohio (and I was $50K upside down). Fortunately my mortgage was with a credit union and I did not have to go into default to get the short sale so we were never late on any payments. We are in a 2 yr lease on a house rental in Ohio and I contacted Wells Fargo just to start getting some information on mortgages and such as next June our lease is up and the loan rep said I had to wait 2 years to even apply for a mortgage. I gather from the postings here that may not be true (proceeds from the sale were used as payment in full).

  • DJM,

    Your scenario is ideal for a FHA purchase after these new guidelines were released but you should know that not every FHA lender will follow them. If you seek a FHA lender who does not restrict this, you’ll be able to buy now.


  • GMM

    Hi Keane,
    My husband and I were transferred from Ohio and had to short sale our home a year ago.

    The problem I am running into is that we were never late on ANYTHING but a month before the SS went thru Citi told me I had to let my last payment go 30 days late or the SS would not go thru. I have an email string were I am basically begging my “Mortgage Counselor” to accept the last payment and she is writing back… “Do not pay your last payment”

    So I guess my question is… Will this email help me in any way?

  • GMM,

    The only thing you can do is see if you can dispute that late payment and see if the old lender can provide proof you were late. If they can’t, your dispute to the credit bureaus may get it removed.

    Did they not offer a deficiency option where you could carry the debt?

  • Steve

    I moved from wiosconsin to Tennesee, owned a home in both states. I had to short sale the home in Wisconsin while owning and livingin my home in Tennesse. I tried to refinance my Tenn home and the underwriter would not allow the refinance. Does the Fannie Mae Guidelines apply to refinancing your current residence?

  • Steve,

    If you were late on your short sale, it would affect your ability to refinance your primary residence. Lenders typically look at the payment history on all mortgages.

  • How Long Do I Have to Wait to Buy a House After a Short Sale? Keane Ng with Cobalt mortgage hits it right on the money when it comes to shortsale information!

  • Joseph

    Hi Keane
    Thanks for posting the article. I have one question for you about my eligibility. I work as IT contractor. I just paid my last months mortgage but I dont have any work now – my project ended. I dont know when I will land another job either although I am actively looking. I dont think I will be able to make my next payment and looking to short sale my house – I am about $175k upside down – I live in CA. If I go into short sale, I will be in default clearly because I dont have the money to pay. I have some savings but I need to pay other bills and sustain my family until I find a new job.

    Just a bit more background – I talked to a real estate agent who said that after short sale I would be able to buy another house using FHA loan if I have document to prove that I have work at that time… but I am not sure if I would qualify – and whether he is just trying to get whatever commission from shortsale.

    Assuming the shortsale happens, will I qualify for an FHA loan because my shortsale is due to a job loss? I read the 09-52 letter you linked to and there is an exception clause

    Exceptions: Lenders may make exceptions to this rule for borrowers in default on their mortgage at the time of the short sale if

    The default was due to circumstances beyond the borrower’s control (such as death of primary wage earner, long term un-insured illness, etc.), and
    The review of the credit report indicates satisfactory credit prior to the circumstances beyond the borrower’s control that caused the default.

    Have you actually seen people qualify for FHA loan after they shortsale due to job loss?

    Thank you for your time.
    Troubled Jobless Joe

  • Joe,

    I’m sorry to hear about your hardship. I have heard of lenders who do, but it’s a catch 22. FHA also has restrictions as to how many late payments you can have over the past 24 months. Most lenders won’t do the loan unless they have LOTS of documentation for the hardship. Preferrably, you would never be more than 1×60 days behind, but that’s not always possible. If you can get away with the short sale with that or less, you have a decent shot at qualifying after the short sale.

  • Michael

    I had a short sale 1 year ago and my name was the only one in the loan. I recently got married and my wife has good credit and does not have any loans under her name right now, we just payed off her credit cards. I had lost my job but now working and we are trying to buy a house, my question is that if is there any way that my wife can buy the house without my name on the loan but somehow still use my income to give her a better chance to qualify for a house that is around 225k. She is makes 38k/year. Thanky you for any help, p/s we live in CA

  • Michael,

    You cannot use your income to help qualify if you don’t fit the credit guidelines but you can get a non-occupying co-borrower to co-sign for your wife.

    If a family member agrees to co-sign (Not live in the house), we can use that income and your wife’s to qualify.

    I hope that helps.

  • Lana,

    I would work on fixing your credit and saving money for a 5% down payment or more. Conventional loans only require a 2 year wait period vs. FHA but the credit score requirements are higher.

  • Keane,
    I am a disabled veteran and I had to short sale when I got divorced. I hd a V.A. loan and was told I had to be 60 days late. I did that sale fnalized and reported on my credit as paid in full for less than full amount. My credit is back up into the mid seven houndreds but my ss was closed on march first. I want to buy what would be my best way to aquire a loan again?

  • Eric,

    Unfortunately, you probably cannot get another VA loan but under your circumstances, you may qualify for a FHA loan. Your hardship is well documented and your strong credit following the short sale will definitely be a compensating factor. You may be able to buy now with the right documentation and lender.

  • Pam


    I short sold my home almost 2 years ago. I did get behind in the mortgage but it was due to documented medical reasons. I have since then had my credit repaired and I have a credit score over 680. It it possible for me to obtain a loan after the two year waiting period? I was told by the realtor I was working with that I could not qualify for a loan no time soon? I need the opinion of a loan professional as opposed to a realtor.

  • Pam,

    I think a good letter of explanation and checking with a good FHA lender may allow you to buy FHA. It is a case-by-case scenario based on the underwriter.

  • Keane,
    I appreciate your responce, I live in kitsap county do you have any names of lender you recomend? Thanks much!

  • Pam

    Thanks, can you reccomend a lender for my situation.

  • Pam, What area are you in? Eric, I just emailed you directly.

  • Shanae

    My husband and I are over $50k upside down in our mortgage. We owe about $240, and the most our house will probably bring $185k tops. It is beginning harder and harder to maintain payments along with every day expenses. We want to be proactive and do something before we become delinquent. We consulted a realtor, and she told us our only option is a short sale. I have been reading a lot about short sales and all the different options we may have. I read all your stories and wanted to inquire about an FHA lender in the state of Virginia that may consider lending us mortgage funds once we have downsized and gotten back on our feet. We don’t plan on becoming deliquent on our payments, we just want to get out and start over before that happens. Please let me know what you think about this.

  • Shanae


    That’s a tough scenario that many others are going through.

    I don’t know of any specific lenders but the key is to see if you can convince your lender to accept a lower amount without going late. It’s a catch 22, because they often won’t accept the short sale until the loan is delinquent.

    If there’s no way to do this without going late, you’ll have to wait 3 years for a FHA loan (2 years with conventional but the down payment is much bigger).

    I wish I had better answers for you. Good luck.

  • Rick

    What do you know about NACA?

  • Shanae

    Absolutely nothing, what is NACA??

  • Nothing other than what I could find on Google.

  • Jesi

    My husband and I just listed our home as a short sale due to a drop in income and medical bills. I was in the hospital last year because of cellulitis from a shot I was given in the doctors office and have not been able to get new insurance as a result of this. Thus, we have remained on COBRA and are on payments with the hospital. Our realtor told us that if we did not miss a payment, we would be able to purchae a home after ours closed. We have a HELOC so we will be responsible for the difference (about $70,000) unless our realtor can negotiate something else with the credit union. We live in Arizona where the market has taken a big hit. So, we may in fact be able to purchase a larger home than what we were in because we could afford a higher purchase price due to the lower interest rates. Would this be a violation of statment that you can not buy another house for a profit? We would not be selling the house for a profit, but only living in it. Thank you in advance for your help.

  • Cory

    I short sold my home in September and was approved for around the same time to purchase a new property. I fully disclosed to them the sale was a short sale etc. We were doing the shortsale due to divorce. We were 100% current on the loan prior to the shortsale. My ex wife refused to cough up her share of the last mortgage payment before it sold and we ended up with a single 30 day late on the last payment the month before it closed. The bank I am working with who has given me a full approval wants to rerun my credit and I am afraid that once they see the single 30day late they are going to pull their approval. I have a house lined up but am trying to find out if I should give up or if there are any banks out there that would possibly still fund the loan.

  • Jesi,

    The profit guideline is there to avoid abuse of this guideline. They don’t want people selling a house for less than what it’s owed just so they can buy another at today’s price. With your situation, you should be fine.

  • Cory,

    Unfortunately, that one late payment would be a hurdle for you. Your situation is perfect for this guideline except the last late payment. That’s very unfortunate.

    Let us know how it works out.

  • Jesi

    Thanks so much Keane. I appreciate your response. Have a great day!
    Take Care,

  • Machelle

    Hello, I filed bankruptcy in 2007 which included my home and it was dischanged in 2008 and I did not reaffirm my loan. The home was not foreclosed as I was able to sell it as a short sale in 2009. My credit reports states that the bankruptcy was discharged under the bank’s information. When will I be able to purchase using FHA?

  • Machelle,

    Unforutnately, you’ll have to wait 3 years from when the short sale occured. 2012 will be the first time you can buy.

    It’s crucial that you begin working on your credit now. Please see this post:

  • Cory

    Ok… so my loan was approved, credit issues resolved, got the single late removed from the report. I have another hurdle, I am now being told since we assumed the second loan as a new unsecured loan I do not meet the FHA requirements. I feel I do as I believe those requirements are geared towards people who short sale and the bank does not fully release their liability. So wish I could just buy a house and move already.

  • Cory,

    There is a provision that requires the debts to be “paid in full”. You can move that debt to another unsecured loan where you make monthly payments so the old mortgage company states the loan is “paid in full”. That payment will reflect on your credit, so the lender will add this to your debt ratio but if you still qualify, you’ll be fine. In fact, the 2nd mortgage company can create the new loan themselves as long as they mark the “mortgage” as paid in full.

  • Josh

    I’m currently 5 months late on my payments after trying unsuccessfully for a loan modification with bank of america over the last 9 months. The hardship that I’ve proven is due to divorce with a reduce income from dual to single. The crazy thing is that they declined me for the HAMP because I had more than 3 months worth of reserves. Then they declined me twice for an in house because I didn’t make enough. Now it’s time for a short sale. My question is, after I short sale the house that is now $120K under water, will I be able to be a co-borrower on another loan with my girlfriend? More than likely, her income will be enough for the new loan. Ideally, we would take on the responsibility of the loan together. Do I too have to wait 2-4 years before i can be a co-borrower or does that time line only exist for the primary borrower?

    Thanks in advance – great dialog here!!!

  • Josh,

    Unfortunately, you’ll have to wait 3 years for FHA but conventional guidelines may only require 2 years depending on your credit and how much you put down. The key is to work on your credit right away so your score can begin improving immediately following the short sale.

  • Will

    Hi David,

    I sold my house under a short sale contract this last august due to some very grave circumstances,i was unemployed for 7 months last yr, and after depleting my emergency funds to pay the mortgage, the bank refused to work with me since i was still paying the mortgage,

    Then my mother fell ill, and eventually died in January this year,i stopped paying the mortgage as i was out of funds( so i was delinquent for 7 months),luckily the bank agreed to a short sale and they took an $80,000 hit as the house was under water anyway.

    I’ve since found a job out of state and relocated, and have been released from the mortgage by the bank as of august this yr (i have all the docs proving this), My question now is how long do i have to wait for a conventional mortgage, and an FHA mortgage?

    I’m trying to gather information on what i’ll need to do and what i need for my next purchase, but there isn’t a lot of meaningful info out there.

  • Will,

    The waiting period for conventional loans is 2 years but remember that conventional loans have higher credit restrictions than FHA, so your credit scores will need to be higher if you plan on putting a down payment of less than 20%.

    FHA has a 3 year waiting period. If the grave circumstances you speak of include things outside your control, you may be able to buy sooner.

  • marques

    First, I must apologize for the exceedingly long post. My wife and I short sold our house and just closed December 30th. We were 11 months behind on our payments as the bank (Bank of America) dragged their feet, and as a result the first buyer backed out after 3 months of waiting. I was forcably relocated out of state (our house was in Phoenix) due to the economy. I opted to take a temp relocation with my company, as opposed to being laid off, and I could not afford a mortgage and rent. We are, and have been up to date on all other financial obligations, and in fact, even with the delinquent payments, our credit is still around 680-700. We have in writing from the bank that the loan will be reported to the credit bureaus as “settled.” We are happy and relieved to have this all behind us as we are expecting our first baby in March. We are moving back to AZ as my company is relocating us back, and we would like to buy a house. I have 2 questions:

    1) Since the bank is reporting it as “settled,” can they seek subrogation for the deficiency?
    2) We have, and are current on all bills, and can afford a mortgage of about $150k, how long will we have to wait before getting approved for a loan? I read in the FHA link that exceptions can be made if you are in good credit standing otherwise.

    Thank you in advance for reading this very long post. I appreciate your time and response.

  • Marques,

    FHA will consider waiving the 3 year waiting period if circumstances outside your control, such as medical reasons, lead to the short sale. If the underwrriter doesn’t approve for this reason, you must wait 3 years. Conventional guidelines require 2 years.

    As the potential deficiency, I’m not sure. You’ll probably need to talk to an attorney.

  • CMom

    Hi Keane,

    I have a general question that probably represents the greatest concern from people who went through a short sales process but would like to be homeowners again someday. Due to divorce, my ex and I completed a short sales in December 2009 in CA. Both 1st and 2nd were with BoA, who made us sign a promissory note as a condition to the short sales. However, the final document states something to the effect of “we may pursue the deficiency…” despite the signed promissory note. I contacted a real estate attorney who seemed to think it would be hard for the bank/investors to go after us someday since 1)there are a lot of people in our boat, and 2) people could simply declare bankruptcy.
    But if I were to be a homeowner and my name were to be on a property title someday, would I make a better target for them to come after me?

    Your thoughts would be appreciated.

  • CMom,

    That’s a great question. If they knew you had more assets, such as a home, it does make sense that they would go after you but I don’t know how they would be keeping tabs.

    This is maybe a question for another attorney, but since this promissory note isn’t on real estate, does this mean you no longer owe it if you exceed your state’s “Statute of Limitations”?

    Statute of Limitations is the timeline that an entity can legally come after another party liable for a cost. There’s different versions for different states. It’s 6 years in WA state. I would explore this and track that timeline closely. If you get really worried, you can always seek legal advice.

  • CMom

    Hi Keane,

    Thank you for your speedy response! I just checked online and the statute of limitations on debt in California for both written contracts and promissory notes are 4 years. I am not so concerned about the promissory note as I intent to pay it in full eventually. What I am worried about is the deficiency on the 2nd (which is far greater than the promissory note amount) – do you think the 4 years of statute of limitation applies to my short sales scenario, especially with respect to the 2nd deficiency?

    Lastly, I am truly grateful of what you are doing here, Keane!

  • Cory

    I just wanted to share for those of you that are looking and have had a previous short sale and were never late, you can find a bank that will work with you! I closed on my new home 3 months after I sold my previous one in a shortsale!

  • Kim

    Cory-where did you find financing? I can’t find anyone yet…

  • Kim,

    Where do you live? I can maybe help find someone.

    I got my first approval for someone with lates. The exception basis that it was outside the clients control. It took a VERY strong case to get this approval but we got it.

    An approval where there were no-lates should be easier.

  • Kim

    MN-our bank forced us to go default to qualify for a short sale…any hope?

  • Kim

    i should mention we lived in WA-lost my job-had to relocate for work…

  • Gina

    We are coming up on our two year aniversary of short selling our house due to job loss/transfer and we would like to buy a new one. We have the 20% down payment and my credit score has rebounded to the mid 600s. Any suggestions on lenders that are more willing to work with us? I know all the requirements are 2 years but just want to see if some lenders are more willing.

  • Kim,

    Unfortunately, that circumstance won’t work. If you don’t think you can save for a 20% down payment, which has a 2 year waiting period on conventional, FHA will require 3 years. However, make sure you use your time now to build your credit so you’ll qualify when you reach the 3-year mark. This is very important.

  • Gina,

    Your scenario sounds like it will fit conventional guidelines. What area are you in?

  • Gina

    We are in pennsylvania. Any info would be appreciated.


  • Gina,

    I passed your email to a gentleman named Greg. Good luck!

  • Mike

    We short sold our previous home 2 years ago. My FICO score is now in the 660’s and my wife’s has rebounded to the low 700’s. I have a long-term salaried income and can make a 20% downpayment. For the amount we are looking to borrow, our ratios will be exceptional (<10% debt to income) since I don't have any other debt.

    So far, lenders I've spoken to have said that for conventional financing, they treat my short sale the same as a foreclosure. I've been told more than once that it would take 7 years to get conventional financing.

    Is there any alternative to waiting another year for FHA? By the way, I live in Florida.

  • Mike,

    On the Fannie Mae seller guide, you’ll see that short sales have a 2-year seasoning period for conventional loans (see page 434).

    It’s not treated the same as a foreclosure. Show this to your lenders. Good luck!

  • LB

    I need some advice. I own a home in Idaho through FHA right now. I was told at my job that I would be losing hours and possibly my job shortly, so I found a new job in Florida and moved my family. We have not been late on payments so far, and are renting right now in Florida because we were told that we wouldn’t qualify for a FHA loan until our house in Idaho was sold. It’s been on the market for 6 months with not much response. We have the option to rent it out or consider short sale, but don’t want to incur penalties from the short sale as we would like to buy a house as soon as we can down here. We are paying for both houses right now and it’s killing us. Would it be better to short sell now before we fall behind or see if we can rent until it sells for what we owe?

  • LB,

    I can’t give advice related to the benefits or downfalls of short selling your house, but I always try to find a way to fix a problem without a financial hardship.

    Is there no other possible way of buying on a conventional loan or USDA loan? Using a conventional or USDA loan, you may be able to buy, keep the house you have and rent it.

  • Stephanie

    We did a short sale 2 years ago, and we were late in payments, but only because our real estate agent advised us to do so. She said that some lenders will only approve a short sale if you show a hardship, and having a late payment makes it a more compelling reason for the short sale to be approved. Do we still have to wait for the 3 year waiting period before we can buy again? I really despise the advice that our agent gave and wish we just remained current on our payments! It’s so frustrating! Other than that, our credit is back on track, score of 680 and 740.

  • Stephanie,

    2 years is good enough for a conventional loan and a 740 score is definitely good enough. If a private mortgage insurance company will insure the loan, you can likely buy now.

  • Adrian

    I have a 12 year old short sale from an old USDA mortgage. I am tryn to by a home but now my mortgage loan is on hold in underwriting. Should I be worried?

  • Adrian,

    No way. That’s way too old to have an impact. If underwriting is having issues with the file, this should not be the reason why.

  • TracyAnn

    My husband did a short sale on a house he owned due to job loss (they were bouncing payroll checks. I still have the proof) We are now trying to buy a house. Every mortgage company I have talked to said we have to wait 3 years to get a motgage. Which will be this August 4 months to go. Is there a way to get a lender to make an exception of doing it 4 months early? They said they are treating his short sale as a forcloseure.

  • TracyAnn

    p.s We live in NJ.

  • Tracy Ann,

    It depends on the FHA lender. If the proof is good enough, some lenders would consider it. We’ve done it at Cobalt but I can’t say every lender will consider it. However, you’re only 4 months away. You should be able to start making offers in 2 months on a 60 day closing. Can you wait since you’re so close? You’re technically only about 2.5 months away since it’s almost May and you need a month to close on a transaction anyways.

  • TracyAnn


    How can I find a lender that will make an acception in New Jersey? At first the mortgage company approved us so we started looking for houses. We found one we like and it is only $149,900. When I called to tell them we found a house and we want to put an offer on it that is when they called me back and said they won’t do the mortgage until Aug 28. We are expecting twins in the end of July early August so we really wanted to be in a house by June. Other wise our option is an appartment for a year.

  • TracyAnn,

    I would only ask direct mortgage banking companies that direct sell to Ginnie Mae. That’s a weird request coming from a consumer but it’s your only chance. Ask a few real estate agents who they would recommend in that area, as they typically will work with a lender who does a good job.

  • Teri

    In November it will be 2 years since our short sale. we live in Idaho and our bank came after us for the deliquent amount right after the sale; thus, we had to file Bankruptcy. It has been almost a year since our BK was discharged. When can we buy a home? We had 2 mortgages, no HELOC and they were fixed, the first settled, the 2nd came after us for 75,000. My credit is still decent, 680 when I bought my pickup at a great rate almost 6 months ago. The BK lawyer said the only reason we had to file BK was because of the Idaho law (can’t remember what it is) allowing banks to come after you for the deficient amount.
    Thank you,

  • Teri,

    That sounds right.

    You have two seasoning requirements. Seasoning from the short sale and the Bankruptcy. The short sale seasoning for conventional loans is 2 years but bankruptcies are 4 years. FHA loans allow purchases after 3 years from a short sale and 2 years from a bankruptcy, which sounds like your fastest option. When you reach 3 years from November, you will have satisfied both the Short sale and Bankruptcy seasoning requirements for FHA.

  • Dale

    I bought and lived in a house with my children. I met someone and we are getting married. I moved out but still paied my mortagae. Without the extra imcome for other bill such as utilities, and groceries my children could not afford to stay in the house and I could not afford to pay for utilities at two residencts. We applied for a modifioation but were denided, We asked about refinace but were also denided. My children stop paying the mortgage and gave me back my money I gave them for my part of the mortgage. We put the house up as a short sale and sold it 5 months after the last payment was made. ( last payment was made in Jan 2011 the house sale will close June 16 2011). My soon to be husband and I would like to buy a house. He has great credit 720 and before this short sale I had a 750 credit score. How long do we have to wait to be able to get a home loan ? We live in California

  • Dale

    sorry I had the wrong email address before for the letter above from Dale

  • Dale,

    If your husband’s income is enough to qualify for the purchase on his own, you can buy now. You won’t have a negative impact to the purchase. If you need both of your incomes to qualify, you’ll need to wait 2 years for a conventional loan or 3 years for a FHA loan.

  • Julie

    We have lost over 100k inequity and will owe more than the house will be worth in 13 yrs, when we retire. We won’t be able to afford the house pymnts then. Should we short sale now and try to buy something in a few years? We live in California and wanted to know about the recent short sale law.

  • Julie,

    I’m not sure about any laws pertaining to a short sale but you’ll need 2-3 years to qualify for a loan following a short sale.

    Have you considered trying to buy a home and renting your home? In 13 years, when you break even, you will have equity in the home you bought. If you don’t think you’ll qualify for a new purchase, read my newest post on the “rent-rent-buy” strategy. Just a thought.

  • Keri

    So I was told today by a Real estate lawyer that if I short sale my house I could get a loan in 2 years. Now I am reading it is 3 years. I am trying with my fiancee to lease/purchase a home in 2 years. what are my chances of really getting a loan if within the next two years I really work on getting my credit up.

  • Keri,

    It depends on the program. This post is regarding FHA loans. Conventional will allow a purchase following a short sale after 2 years but the credit guidelines are tighter for conventional.


    MY question is my lease is coming up nov 1st i did a short sale back on oct 2010.should i apply for a home loan next month i have 20k saved up to buy a home for my family i will not have any problems proving great income per month any suggestions?

  • Sarah

    We just listed our home on a short sell since we are having a hard time making payments. Should we continue to try to make payments or stop all together. We will be moving and would like to buy a house again…Looking for any advice. We are in AZ

  • Keane


    If you were late, you’ll need to wait 3 years for a FHA loan or 2 years for a conventional loan.

  • Keane


    I would definitely check to see if you qualify to buy before you short sale.

  • Chris


    I live in SoCal and completed a short sale in January 2010 after having negotiated with bank for almost 7 months previously. Short sale was due to dramatic loss of income. I purchased a new much smaller and affordable home in October 2010 with 40% down and 60% LTV hard money mortgage. When can I qualify for a conventional fixed rate 30-year 80% LTV mortgage? Would it be this January (2012)? I have excellent payment history with hrad money mortgage, but want to get rate down to reasonable level, paying 11% now. Thanks.

  • Chris


    A follow-up question for my previous post…if I can qualify for a conventional 80/20 mortgage loan in January 2012 (two years from my short sale closing), can I start the mortgage application process now to try and close in January 2012, or do I have to technically wait until January 2012 to even apply? Many thanks.

  • Keane


    You should qualify if all other criteria is met. The credit report will show payment history and you’ll have to have enough payments separating the short sale from the refinance.

    Fannie Mae will reject the file until the payment history is through, so the process will likely not start until after the 2 year seasoning is complete but its definitely worth starting the process now. Have a lender update the income/assets/value to ensure your eligibility before we have to wait for the credit updating.

  • Foreclosure specialist

    Good resource here. Short sales are the way to go right now. We are Sacramento Short Sale Specialists and are getting many of them closed. Fortunately lenders are finally starting to get better at them.

  • viola lucero

    Need direction for my son…he is in process of short sale…hasn’t paid house payment for several months…credit is at rockbottom as a result…credit was the highest it could be for many years. His wife now wants a divorce…telling him that once the short sale is done a friend of the family’s real estate person has promised to get them into another house/which they will be able to purchase. Is this possible? also, is it wise to even purchase a home if a divorce is forthcoming? Is it possible for them to each purchase their own home….advice???? options???? greatful for your help.
    worried mother who lives in New Mexico…son is in California… l000 miles away,…

  • Viola,

    Let’s first visit the topic on when he’ll qualify. With a defaulted mortgage, he would need 20% down to buy at 2 years (conventional financing) or 3.5% down at 3 years (FHA guidelines for seasoning). Either way, he would need to wait a short while if he’s using traditional financing to make his purchase.

    Your son should definitely speak to an attorney about the risk associated with buying during a divorce, but I would guess the divorce would be complete within 2 years of the short sale.

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  • It can be confusing and deflating with recent changes coming August 16 Feb 2014 where Fannie Mae is Changing the waiting period to purchase or refinance after a short sale to 4 years waiting period.
    We have a solution in approved States like California to allow qualified borrowers who have had 1 incident in the past to Purchase or Refinance a Primary Residence with NO waiting period at all.
    There are also other options, as Fannie Mae requires a 7 year waiting period After a foreclosure, but we will allow qualified borrowers have had 1 incident in the past to Purchase or Refinance a Primary Residence with NO waiting period at all in approved states.
    Please feel free to contact me to get accurate information.

  • Correction:
    …..recent changes coming August 16th 2014

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  • Gayle

    my experience with a short sale should have been easy 60-90 days but my bank let two buyers set without response for months. Then one dropped out after 90 days. The second held on 10 months but that was not without a hitch. They finally did purchase my house. My lender also listed my house on the sheriffs sale site and almost sold it 5K below what I had it sold for and then it was another 4 months before it sold. my buyer put in the offer early April 2014 and the closing wasn’t until Jan 2015. I also had to be in default on my loan payments however, I had to occupy the house until such time that it was sold. I didn’t get enough notice (they refused to give me a closing date)to find a rental and I moved out without a house to move into. I found a rental 3-4 days after I closed on my house. I also had just put a new roof on the house, installed a shower and installed a new hot water tank. I refuse to go thru this kind of stress again. they told me it would be 3 years before I can get a new loan for another house. then FHA changed their rules but it is a catch .22 I probably still can’t qualify for it. my short sale was accepted payment in full also.

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