If you found yourself having to negotiate with your lender to get out of your mortgage and have a Metro Atlanta short sale on your credit history, there are some things you need to do if you ever want to become a homeowner again.
Anyone who has been through a Metro Atlanta short sale is pretty much branded as a high-risk borrower, so new loans won't come quickly or easily in the future.
A short sale is when a lender agrees to accept less than is owed on a property, allowing the borrower to walk away and avoid foreclosure. Fannie Mae, the federally controlled mortgage investor, sets guidelines for the minimum amount of time that must elapse before a short-seller is eligible for another loan salable to the agency.
Waiting Period After a Metro Atlanta Short Sale
If you've been through a Metro Atlanta short sale, Fannie Mae requires a waiting period of at least four years for short-sellers who can only put down 10 percent on their next home. The waiting period is shortened to two years for borrowers who can come up with 20 percent.
Fannie does allow the four-year period to be cut in half for borrowers who can document that their Metro Atlanta short sale was a result of "extenuating circumstances." The agency defines these circumstances as one-time events that were beyond the borrower's control, such as job loss, medical bills, or a financial hit from divorce. Borrowers must also be able to show that they had no reasonable option other than to default.
Those who have been through a Metro Atlanta short sale who hope to someday obtain another mortgage should pay careful attention to their credit while riding out the forced waiting period. Frugal management of revolving credit should be first and foremost on your mind making sure outstanding balances do not exceed 30 percent of your credit limit. And borrowers should stay current on all of their credit obligations.
If you've been through a Metro Atlanta short sale, keep detailed records of income sources. New regulations require lenders to prove borrowers' ability to pay, and the more documentation you can offer, the more the originator can go to bat for you on a new mortgage.
Having a Metro Atlanta short sale on your credit history is not the end of the world, and certainly not as damaging as a foreclosure. Just realize, buying another home will be a challenge, but certainly not impossible.
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