Over the past couple of years, Short Sales have become more prevalent. Banks have been more receptive to short sales and have opted to negotiate instead of foreclose. Several clients who have called to be prequalified have had a Short Sale in their recent past. They have asked me when they can get back into the buying pool again. The rules to obtaining a mortgage after a short sale differ depending on the type of financing a buyer wants to use for their next purchase.
With a 20% Down Payment, a Buyer can purchase a home using Conventional Financing after a 2 year waiting period from the Short Sale date (which can be found on their final HUD settlement statement). With 10% Down Payment, a buyer must wait 4 years from their Short Sale.
Using FHA financing, a buyer must wait for 3 years to have passed from the Short Sale date.
The waiting time with VA financing will be 2 years.
USDA financing will be a 3 year wait from the Short Sale date.
It is a good idea to great prequalified with your lender from 6 months to a year out before you purchase another home. Many times there could be some credit repair work that may need to be done on your credit history to make sure that your credit score and history are reporting accurately.