New Mortage after 7 Discharge

[dm415]

I just dont get it.I had 2 homes before bk7.I let one go.BOA took 1.5 years to actually foreclose and sell it and then show up titled in new owners name,Foreclosure not showing up anywhere,at least not on credit report.So my current home shows IIB 0 bal.So the all mighty magic question is can I qualify for FHA.I need an underwriter for a new buddy.Maybe the best thing to do is find a house for the right price,put a contract on it and see what happens.What do we think about that?

[DebtEnder]

I'm dealing with a similar issue. I had 3 houses, one I lived in, the other was a former residence converted to rental and a 3rd was an outright investment purchase.

Both residences past and current have been foreclosed on(I'm in the process of moving out now) the straight up rental propery has been on the auction block from October till now. I just got yet another big fat certifed letter from the lawyers for Citi saying "they have been retained to begin foreclosure proceddings yada yada... No 30 day auction date set so at the earliest it can be done now is sometime in March maybe....

I'm sitting here going do I need to find a place for 2-3 years? Or maybe just hope citi never gets it done by the time I'm ready to buy again. That or try to deed-in-lieu to these lawyers. These are the same guys that sent me the last 5+ packets in the mail. Enough trees have died already

Or perhaps save up 40-50k over the next few years and find a cheap foreclosure. Rehab'd a house in the past, can do it again....

[gophermn]

I have my agent talking with an underwriter as we speak. Like you my home was IIB and shows $0 on the credit report. My credit scores are good for a FHA. My question to my agent is this: If my home is IIB and my 2yr discharge is this April, can I get a FHA FULLY KNOWING I might have to put my current home in as a short sale.
Because to be honest, I would rather use the $$$$ I am saving not paying the mortgage and slide it over for a hefty down pymt for the new home.

He is getting back to me next week. Only thing is I want to make sure I am pre-approved for a new home. My luck as you have it - I end up having to sell the home because it was a short sale and no pre-approval letter was granted. Yikes!

[mom2three09]

I have my agent talking with an underwriter as we speak. Like you my home was IIB and shows $0 on the credit report. My credit scores are good for a FHA. My question to my agent is this: If my home is IIB and my 2yr discharge is this April, can I get a FHA FULLY KNOWING I might have to put my current home in as a short sale.
Because to be honest, I would rather use the $$$$ I am saving not paying the mortgage and slide it over for a hefty down pymt for the new home.

He is getting back to me next week. Only thing is I want to make sure I am pre-approved for a new home. My luck as you have it - I end up having to sell the home because it was a short sale and no pre-approval letter was granted. Yikes!

So you're NOT paying your mortgage on your current home?? But your plan is to do a short sale before a foreclosure happens so you will qualify for a mortgage at the 2 yr mark rather then the 3 yr ? Hmmm...

I know I've read where mortgage companies give a 1099 (?) to people who have sold their home via a short sale, but that wouldn't be possible if the home was IIB, correct?

How long has it been since you've not paid your mortgage?

[mom2three09]

Found this info over on the foreclosure board...

In the long run, is doing a short sale worth it?

That is a difficult question to answer, but in general, since there is no benefit to the seller for doing a short sale, the anwwer is no. Also, for many people who consider a short sale, they have other debt problems and income short-falls such that a short sale does not solve their financial problems. As for credit reporting, a short sale is no different than a foreclosure, the same FHA/HUD and Frannie/Freddie guidelines apply for short sale as for foreclosure.

Looks like the short sale is treated as a foreclosure in FHA/HUD's eyes so it wouldn't do us any good to go for a short sale.. would still have to wait 3 yrs post BK to get a new mortgage (so why not just stay as long as you can while the home is being foreclosed on & then rent for the next 3 yrs)

[gophermn]

mom2three09 - thats about the best option is to just sit in your current home - not make any payment (save the $$$$) and then perhaps rent and if lucky, rent with option to buy.
Else someone was telling me to go ahead with the short sale and if its not on your credit report the time you apply for a new FHA, tell the underwriter your home is a rental and the new one primary.
I see ethical issues with that - but hey - I am just preaching what I was told.

[Ugh07]

Underwriters have gotten pretty savvy about this type of stuff. They will want to know exactly what is happening with the house you live in now. If they think there is even the slightest chance that you are walking away from it, your new loan will be denied. If it looks like you owe as much or more than it is worth, your new loan will be denied. The best bet is to sell the house, make good on the loans and then buy something else. If you walk away, you will have to wait the addtional 3 years to qualify for a fha loan, and the 3 years starts from the day of title transfer.