An agent said it yesterday, and I talked to a loan rep who confirmed it.

FHA has expanded their underwriting guidelines for those who have a short sale on their record.

They already allow borrowers to come back three years after a foreclosure or short sale, but now there is an additional option.

People who have short-sold their previous home can now buy their next home immediately, rather than having to wait 2-3 years, as long as:

  • They have a legitimate hardship,
  • Have made their last 12 months of mortgage payments on time, and
  • They “aren’t taking advantage of the market”, meaning that they aren’t buying a much more-expensive home.

The thought of convincing the existing lender to approve a short sale when the borrower is current on payments sounds a bit daunting, but the loan rep said that they have closed several of these already!

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Jim the Realtor
Jim is a long-time local realtor who comments daily here on his blog, which began in September, 2005. Stick around!

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