Licensed in the State of Florida


Buying House after Foreclosure 2016

Buying House after Foreclosure 2016


Buying House after Foreclosure 2016

A borrower whose previous residence or other real property was foreclosed on or has given a deed-in-lieu of foreclosure within the previous three years is generally not eligible.

Foreclosure must have been resolved for at least 3 years with no late payments since the date of resolution. 

Seasoning requirements

  • Government loan: Seasoning is determined by the date the claim was paid
  • Loans other than Government: Seasoning is determined by the date of sale the lender sold the property

FHA after foreclosure Extenuating circumstances

New FHA loan requirements borrowers may also be eligible for an FHA insured loan on a purchase transaction after 12 months from the completion, discharge, trustee's sale if the borrower meets the requirements for extenuating circumstances Economic Event.

Borrowers with a prior bankruptcy, foreclosure, deed-in-lieu, or short sale may be eligible for an FHA insured loan if the bankruptcy, foreclosure, deed-in-lieu, short sale was the result of a documented extenuating circumstance.

Credit score

New FHA announced a policy change to address risk and strengthen finances. FHA has changed the minimum credit score for new borrowers:

  • FHA requirements new borrowers will now be required to have a minimum credit score of 580 to qualify for 3.5% down payment
  • FHA loan requirements new borrowers with less than a 580 credit score will be required to put down at least 10%
  • This allows the FHA to better balance its risk and continue to provide access for those borrowers who have historically performed well

Today’s historically low interest rates make now the perfect time to purchase a new home or refinance.

One of the most popular types of mortgages is the 30-year fixed-rate mortgage. This loan is usually the easiest to qualify for and provides the maximum interest deduction at tax time. The interest rate stays the same over the life of the loan which provides unchanging low monthly payments.

No matter what the economy looks like, mortgage rates change on a daily, even hourly, basis. Rate fluctuations can cost or save you thousands of dollars. With that in mind, the question when shopping for a loan is whether it's best to lock in a rate or float the loan. Either way, there's risk.

It's your choice the rate-lock option means a borrower fixes the price at the current mortgage rates, provided he or she finalizes the loan within a specified period. The upside is that you are protected against a potential mortgage rate increase. But if the rate goes down, you could end up paying more than necessary. The "float" option, by contrast, allows the borrower to adopt a wait-and-see approach. The risk remains, though: If rates do rise, you wind up losing money.

Not everyone can take advantage of the opportunity to refinance or qualify for a new home loan due to today’s tightened credit guidelines.

To be approved at the lowest mortgage rates, borrowers do not need to have the highest credit score. In addition, the consumers need a reasonable debt-to-income ratio. Most lenders will qualify borrowers at a maximum of 50 percent of overall debt to household gross monthly income. Some borrowers with significant assets or income will be able to qualify even with slightly lower credit scores or higher debt.

Low mortgage rates result in lower monthly payments which can save you thousands of dollars off the life of the loan.


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buying house after foreclosure 2016, buying house after foreclosure 2016

Minimum credit score needed

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FHA Loans

requires a minimum credit score of 500 to buy a home or refinance

500 credit score

VA Loans

requires a minimum credit score of 500 to buy a home or refinance

500 credit score

Fannie Mae

requires a minimum credit score of 620 to buy a home or refinance

620 credit score

USDA Loans

requires a minimum credit score of 580 to buy a home or refinance

580 credit score

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