Buying a new home following a short sale can seem like an uphill battle. However, you shouldn't feel disheartened—you can eventually still apply for loans and purchase a new house. Read on to find a quick checklist for buying a house after a short sale.
After a short sale, there are minimum waiting periods before you can apply for a new mortgage. Lenders will also be more cautious, so you'll have to be patient when working out the specifics and hearing back from them. Taking some time to save up a larger down payment than the lender requires can also expedite the process.
Your credit will likely be impacted as a result of a short sale. If you want to purchase a house in the future, improve your credit to qualify for the best interest rates and financing programs. If the only mark on your credit record is a short sale, you should be able to restore your credit relatively quickly during the waiting period. If you have more blemishes on your credit report, focus on habits such as quickly paying off debt and avoiding late payments to improve your score.
Make Sure Paperwork is in Order
Your short sale may be mistakenly reported to credit bureaus as a foreclosure, resulting in considerably longer wait times before you can qualify for a new loan. Check and double-check how the short sale was recorded on your credit report to ensure accuracy. Also, maintain proper records in case you need to establish that it got misreported.
Pay Attention To Your Current Financial Situation
Even if you can get a mortgage reasonably quickly following a short sale, it doesn't always mean you should. You should ensure you're financially stable before making any significant moves. Commit to prudent financial management so you don't have to deal with a short sale again. Try to keep at least six months of emergency cash on hand so you’ll be equipped to handle any future financial problems.
This quick checklist for buying a house after a short sale can prove to be a valuable resource as you navigate the process of purchasing a new home. Here at Short Sale Cooperative, our professionals are happy to assist you. We can guide you through the short sale process and make sure you understand the distinct stages of the short sale and short sale versus foreclosure credit impact. Feel free to contact us with any questions about our services.