Fannie Mae has announced that they will now lend you money for a mortgage in as little as two years after you have had a foreclosure.
With the record numbers of foreclosures happening, I had been wondering when their would come an announcement of guideline changes and I must admit it came a little sooner than I had expected.
Which will be a good thing for the housing market in general – because it will introduce a new class of buyer: the previously-foreclosed-upon segment.
Before this change, if you had a foreclosure, you were required to wait four years before being able to get a mortgage under Fannie Mae guidelines and two years if your home was sold in a short sale.
Now, if you have had a foreclosure or a deed-in-lieu of foreclosure you can buy a home and get a mortgage from a Fannie Mae approved lender as long as you have a 20% down payment.
When you apply for a mortgage, your loan officer typically uses Fannie Mae’s Desktop Underwriter (DU) software to determine whether your loan application meets the Fannie Mae guidelines. If you meet the guidelines, you are “approved” for a mortgage. If you do not meet the guidelines, you are not approved for a mortgage.
This software will be updated in June so that it has the latest foreclosure, short sale and deed-in-lieu policies in place — and as a result homeowners who had a foreclosure just two years ago and have a 20% down payment can now buy a home and get a mortgage that conforms to Fannie Mae guidelines starting with applications after June 30, 2010.
The message to homeowners who have been going through the foreclosure process?
Start saving your money for a down payment on your next home.
Contact The Mortgage Mark if you have any questions!!
http://www.themortgagemark.com/ mwilkins@capitalfmc.com
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