FHA credit guidelines

[Ugh07]

The only thing looser about fannie guidelines is the new way in which they look at short sales and in reality that was not so much a loosening as it was a clarification of a rule that was never used until the last few years. Not to mention that many many lenders have placed an overlay on that rule to make it null and void anyway. Not sure what your FHA comments mean, sort of like being a little bit pregnant I suppose.

The future is fairly easy to predict when it comes to loan guidelines. When home prices are allowed to stabilize and show meaningful growth over the course of 4-6 quarters then mortgage backed securities will become easier to sell again and guidelines will loosen. Nobody want to invest in MBS's because they know the underlying asset is depreciating, until that resolves itself guidelines will get tighter and tighter.

[Blue_Ray]

I had a short sale on our home and it was sold back in July / 2009 (not foreclosed, it actually sold).
So basically in a short sale, are the guidelines the same as the 3-year wait to purchase another house?

[liverichly]

You can find the searchable FHA credit policy handbook at http://www.fhaoutreach.gov/FHAHandbook/prod/index.asp

[denisec]

I talked to a banker and he was quite knowledgeable about the seasoning period for FHA, it's 3 years after a foreclosure, which means when the bank auctions off the property - period. If you have discharged the loans in a Bankruptcy but later foreclosed it's 3 years from the foreclosure date. If you foreclosed within the Chapter 7, at the same time, the bank took the house back, then it would be 2 years from discharge date. I suppose there might be a lender somewhere that might do a loan for a high interest rate etc...before the 3 years are up, but that is just a remote possibility.

[geye]

I talked to a banker and he was quite knowledgeable about the seasoning period for FHA, it's 3 years after a foreclosure, which means when the bank auctions off the property - period. If you have discharged the loans in a Bankruptcy but later foreclosed it's 3 years from the foreclosure date. If you foreclosed within the Chapter 7, at the same time, the bank took the house back, then it would be 2 years from discharge date. I suppose there might be a lender somewhere that might do a loan for a high interest rate etc...before the 3 years are up, but that is just a remote possibility.

This is what we were told, too.

[denisec]

Thanks, good to know someone else has the same info

I wish it were 2 years after discharge, but maybe it's ok, maybe getting back into homeownership too soon isn't such a good idea...Have you been renting?

[geye]

We're currently still in our house (filing in Sept).... I figure if we find out it's two years....great! But we're prepared for the reality to be three years.

[denisec]

Same here, I was discharged last July paid until Nov. 09 then started looking at a loan mod which still continues, what a joke! I've decided to rent a house, but so far I have saved 6 months of mortgage payments and still no intent to sell notice...so I may push it a few more months...at least I got a sense of rentals out there, and suffice it to say you can find a rental if you have a stable income...not a problem. I figure when am I going to again have the chance to sock money away, and the Chapter 7 protects us against personal liability. I think in some case you may be able to purchase after two years if you can show you are reestablished, and downpayment etc...

[calgirl67]

How soon can you get an FHA mortgage loan if you filed Ch 7 and did a SHORT SALE instead of letting it foreclose?

[denisec]

Hi Calgirl, I don't know for sure, since I haven't been focusing on short sales, and I don't consider myself an expert or anything, but it seems like banks are treating short sales somewhat like foreclosures but I would contact FHA directly on this....they should have an answer. I am not even attempting a short sale, because since BankofAmerica is so difficult to work with...but maybe your bank is better.

[Logan]

How soon can you get an FHA mortgage loan if you filed Ch 7 and did a SHORT SALE instead of letting it foreclose?

How does it read on your credit report. If it says in lieu of foreclosure it should be treated as a foreclosure. The best thing to do is call a lender. I fing Ditech and lenders like that a good source of info. I would never use them but I don't tell them that.

Logan

[denisec]

I don't think it's even worth doing a short sale, you don't get any real advantage ...and the banks are awful to deal with...

[denisec]

If the foreclosure happens AFTER the BK, then it's 3 years from the date the Bank auctions the property off. But there is a lot of confusion out there, even among FHA reps.

[gabbyraja]

Now someone is going to chime in and say "but my mortgage shows IIB so how can they know?". They will look up public records!

What if you are able to effectively dispute the record of prior mortgage and BK off your credit report? Would they still do a public records search, or only if something in your CR flags them?

[denisec]

That's true about claims if the loan foreclosed was FHA. If not...from everything I've read, if you surrendered your home in a chapter 7, you can buy a home with FHA 3 years from discharge date.