RENO, NV - As of August 16th, Fannie Mae is changing the rules for home buyers who have had a past short sale. In the past, they could get a conventional loan 2 years after a short sale. Now, they'll have to wait four years for loan approval. Unless, that is, you've already made an offer on a new home.
A spokesperson for Fannie Mae could not tell us why the changes are being made, but she points out it will save the buyer money. Under the current rules buyers are required to provide 20% if two years had passed since their short sale. After four years, you could get a conventional loan with as little as 10% down.
The change that takes effect august 16th will require a wait time of four years, but reduce your down payment to as little as 5%.
Local experts say it's unlikely the longer wait times will slow the recovery of Reno's housing market. They say inventory of homes under $500,000 is currently limited, creating a sellers market. "I think the most important thing is if you're looking at house buying, get in and talk to a reputable lender and find out what your options are," Says Kelly Horgan, a loan officer with Eagle Home Mortgage. "Just find out what is the next step, what is the game plan to get you in a home as fast as possible."
For more information about purchasing a home after a short sale, check out the links to the right.