Buying Again After a Short Sale - If your payments have never fallen behind 30 days late and the lender does not require that you pay back the loan, Fannie Mae guidelines may allow you to buy another home immediately. The wait for an FHA loan is 3 years. If your payments are in arrears yet a short sale is granted by your lender, you may qualify to buy another home with a Fannie-Mae backed mortgage within two years, regardless of whether the home is your primary residence.
Affects on Credit After a Short Sale - A short sale is not a derogatory mark on your credit because credit bureaus do not show the word "short sale" on your credit report. It may say "pay as agreed" or "paid as less than agreed," among other categories. Some clients have reported negative FICO Drops from 30 points to 130 points. The point drop is typically due to being in default that is behind on your payments.
Credit Reports After a Short Sale - All lenders report short sales differently and some do not report them to the credit bureaus at all.
Deficiency Judgments After a Short Sale - Judgments are often negotiated between the seller and the short sale bank. In some cases, such as California, if the home is your personal residence and was financed through purchase money, there is no deficiency judgment.
Loan Application Questions After a Short Sale - Loan applications do not ask questions about a short sale. You may report that you sold your home.
Length of Time to Move After a Short Sale - If you've had a foreclosure notice filed, you may be able to postpone that action while the bank considers your short sale. The wait for short sale approval can be from 1 to 3 months, or longer.
Taxation After a Short Sale - A personal residence is exempt from mortgage debt relief until the end of 2012 on a federal level. Some states will still tax you unless you qualify for an exemption. An investor is not exempt from mortgage debt relief, subject to certain conditions.
Affects on Credit After a Foreclosure - A number of sources have reported FICO score drops from 200 to 400 points after a foreclosure. Generally this credit score will remain on your credit report as a public record for 10 years.
Credit Reports After a Foreclosure - If a prospective employer runs a credit check on you, your job application may be denied if you have a foreclosure on your record.
Deficiency Judgments After a Foreclosure - Banks are unwilling to negotiate deficiency judgments with the homeowner after a foreclosure. In California, for example, according to the California Association of REALTORS, a deficiency judgment may be filed regarding a hard-money loan if the lender forecloses under a judicial foreclosure versus a trustee sale or if the second loan is a hard money loan and the sale takes place as a trustee's sale.
Loan Application Questions After a Foreclosure - You are required to answer the question: "Have you ever had a property foreclosed upon or given a deed-in-lieu thereof in the past 7 years." If the bank sees you have had a foreclosure, your loan most likely will be denied. If you lie, you may be subject to investigation by the FBI for mortgage fraud.
Length of Time to Move After a Foreclosure - Unless prior arrangements have been made, the bank may want you to immediately vacate the property and can commence eviction proceedings.
Taxation After a Foreclosure - Same as with a short sale. Except some lenders immediately send out 1099s, even if the owner is exempt. Regardless of whether you are in foreclosure, if selling your home will not net enough to pay off your existing mortgages, you may want to consider selling on a short sale. For many years, there were few reasons to sell on a short sale, apart from earning the real estate agent a commission, but times have changed.