Michigan Mortgage

GOOD ADVICE

by Evan Vanderwey on 10/08/11 at 11:45 am

Evan,
Can you finance a buyer who has only been out of a short sale for 2 years? Purchase price is $172,000 and 5% down. Clean credit except for short sale.
Thanks!
Jenna

Hi Jenna,

My first assumption is that with the short sale there were also late payments on that mortgage. If so, then the following would apply:

Rural Development – 24 months from the date of deed transfer. With a 640 score, good to go. Income limits and geographical restrictions apply, but that sale price range is likely okay. 0% down, 0 PMI.

FHA – 3 years from that deed transfer date. 3.5% down, with PMI.

Conventional – 7 years. This could change.

IF by some chance they got through the short sale without making a late payment on that mortgage, which is highly unlikely, then they are good to go (they needed to move more than 50 miles as a result of a job change or because their current residence was inadequate for their needs—usually because of size, but could include handicap issues, etc.)

Hope this helps! Thanks for putting good deals together –there is no better time than the present!!

EV

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