Buying A Home After A Short Sale: Is It Possible?

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Losing your home to a short sale can be devastating. It can be an upsetting time for any homeowner, and it is difficult to think about ever getting another mortgage. Although it is not a simple process, you will one day be able to get another mortgage even if you sell via short sale. Simply put, getting another mortgage is going to take some time, so patience is crucial. However, there are some things you can do in the meantime to get ready to buy your next home.

Play the Waiting Game

It is important to realize that getting another mortgage after a short sale is going to take some time. There is a required wait time before you will be able to get another mortgage. The timing will depend on the lender, but it can be up to a couple of years or more. Conventional loans typically have longer waiting periods than FHA loans or VA loans. If you are eligible for those federally subsidized loans, you can often get into a new house sooner. Still, you need to make plans to rent or set up other accommodations while you wait.

Work On Your Credit Score

Selling a home via short sale is going to have an impact on your credit score. This mandatory waiting period will allow you to increase your score so that you can get the best mortgage rate possible. A lender will require a certain score in order to get a new mortgage loan, so take some steps to improve it. Pay off your debt, make payments on time, keep your balances low, and look over your credit report for any wrong information that can be damaging to your score.

Pay Attention To Your Credit

As you repair your credit, you need to be monitoring your credit report. It is crucial that all of the information on it is correct. For instance, look at the information pertaining to your short sale. Make sure it is not listed as a foreclosure, as that will have a more damaging impact than a short sale. The sale can mistakenly be listed incorrectly on your credit report, so it will need to be cleared up as quickly as possible so that your score can improve.

Obtaining a new mortgage after a short sale is possible. It will take some time and hard work on your part in order to do so. The best thing you can do is remain patient and work on your finances as best you can.