Buying Another Home – After a Short Sale

Although there is no credit advantage over foreclosure with a short sale, there is an advantage when it comes to buying another home. If your house is foreclosed upon, you must wait a minimum of three to five years before attempting to buy a new house. Although rumors abound that a new mortgage with a good interest rate can be had only 18 months after a short sale, this is not the case. However, the truth is not all bad, either: Short-sellers need only wait for three years on an FHA or VA loan and up to 5 years for a conventional loan based on current lending guidelines. It is a good idea, however, to consult a real estate expert before thinking about buying another home after a short sale. Remember that a short sale means you will not be gaining any money after the sale of the home, so you will have to save up the money for a down payment on your new home.