Archive for the ‘repurchasing’ Category

When Can I Repurchase?

Wednesday, May 9th, 2012

So many sellers ask me when they can repurchase after a short sale, foreclosure or bankruptcy. Following is a great synopsis of when a seller can repurchase after a distressed sale or bankruptcy, based on the type of loan/bankruptcy:

FHA Loan:

Chapter 7:              2 yrs.

Chapter 13:            2 yrs.

Foreclosure:          3 yrs.

Short Sale:             3 yrs, * unless borrower was not late prior to short sale (on ANY obligation) and was not trying to take advantage of the market.

 

VA Loan:

Chapter 7:                2 yrs.

Chapter 13:              2 yrs.

Foreclosure:            3 yrs.

Short Sale:               3 yrs.

 

VA High Balance:

Chapter 7:               7 yrs.

Chapter 13:             7 yrs.

Foreclosure:            7 yrs.

Short Sale:              7 yrs.

 

Conventional Loan:

Chapter 7:              4 yrs.*

Chapter 13:            2 yrs. from discharge date or 4 yrs. from dismissal date*

Foreclosure:           7 yrs.*

Deed in Lieu:

• 2 yrs. if subject loan is 80% ltv or less

• 4 yrs. if subject loan is 90% ltv or less

• 7 yrs. if subject loan is over 90%ltv

Short Sale:

• 2 yrs. if subject loan is 80% ltv or less

• 4 yrs. if subject loan is 90% ltv or less

• 7 yrs. if subject loan is over 90% ltv

BK Chapter 7:     4 year waiting period is required measured from the discharge date or dismissal date of the BK.  A 2 yr. waiting period is permitted if extenuating circumstances can be documented.

BK Chapter 13:   4 year waiting period is required for a Chapter 13 dismissal.  A 2yr. waiting period will be permitted with extenuating circumstances (* See below)

Multiple BK filings:  for a borrower with more than one BK filing in the last 7 years, a 5 yr. waiting period is required.

Foreclosure:       7 year waiting period is required, and is measured from the completion date of the foreclosure sale date.

A 3 yr. waiting period is permitted if extenuating circumstances can be documented and the loan-to-value rules are applied, MUST to be a purchase of a principle residence or a limited cash out refinance on an owner occupied, second home or non-owner.

*What are extenuating circumstances?  They are non-recurring events that are beyond the borrower’s control that result in a sudden, significant and prolonged reduction in income or a catastrophic increase in financial obligations.

 

This analysis was provided courtesy of Daniel Dobbs with American Commerce Mortgage. He can be reached at 949-250-3981 or dandobbs6@gmail.com.

 

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