Yes, it’s possible to buy a home ONE DAY after you short sale another home. Sound too good to be true? Well, wait a minute. There are certainly terms and conditions and restrictions that apply. Here they are in a nutshell.
You’ve probably heard that you have to wait at least 3 years after a short sale to buy another property. This is true IF you are in default: If the property has an NOD or an NOTS filed against it or you’ve missed payments, you will have to wait. You would not be eligible for this special loan program.
First and foremost, you MUST be CURRENT on ALL mortgages on the current property. No late payments are allowed on any of the mortgages. Secondly, you MUST stay CURRENT while the short sale is going on and is being processed. The short sale may take 2 to 8 months to get approval and to close, so all mortgage payments MUST be made and MUST be current to qualify for this special financing program. NO LATE payments are allowed. You also MUST have excellent credit overall as well.
The next biggest requirement is that this financing program requires a 20% down payment. For example, a house sold for $400,000 would require a $80,000 down payment, which is a substantial amount of money. You also cannot buy a house in the same neighborhood or general area that you live in currently.
The benefits to this program are huge!! First of all, you get pre-qualified and pre-approved for your new loan BEFORE you put your house on the market. So you know exactly how much you are qualified to buy before you even decide to commit to selling your current residence. You have tremendous peace of mind knowing this BEFORE your house is up to sale. Then you can start looking for a new house while the short sale is taking place. So you are simultaneously selling your current house as a short sale and looking for a new residence.
The goal, of course, is simultaneous (or as nearly simultaneous as possible) closings. You can literally buy another house ONE DAY after you complete the short sale on your current residence.
Cautions, however: The credit requirements are stringent, and not everyone will qualify. You must have excellent credit and no delinquent payments. There is no guarantee that the short sale lender/s will actually approve the short sale.
To summarize, this loan product is not for everyone. However, it does give some borrowers alternative options to renting for 3 years until buying their next residence.
If you are interested in this program, let’s talk! My phone is 909-972-1616 and my email is firstname.lastname@example.org. Please contact me for a free, 100% confidential, no obligation consultation.