5 Things To Know For Buying A Home After A Shortsale And Foreclosure

1. Know that there's going to be a waiting period.  I think this is probably one of the most important things to know, that's why I'm going to talk about it first. The reality is that after you face short sale or foreclosure you can not turn around and buy another home anytime soon. It's best to know this going into it, and wrap your mind around this fact now instead of later finding out and being discourages. Typically with short sales history you can not buy another home till 3 years after you short sale is final.

2. Know that having a short sale/foreclosure on your credit history wrecks it. Anytime you go through something like this your credit is going to be tainted, ruined and will probably have to be re built. Foreclosures stay on your credit history for 7 years. After a few years you will need to rebuild your credit.  I suggest to speak with someone who is knowledgeable in this  to help you re build your credit. They will offered tips and suggestions to help you get started and get your credit back on track where it needs to be in order to finance a loan for the purchase of a home.

3. Know that you're going to have to save money. Buying a home always requires money. But, buying a home after a short sale requires even more. Maybe you bought your first home at zero down besides your earnest money. Next time around when thinking about buying after a short sale meet with your broker to see what financing is available to you.   FHA financing requires a minimum of 3.5% down. Plus, you may want to consider and plan for the fact that you may or may not have to contribute to your closing costs which is another 3-4%. Another thing to consider depending on the area and what the market is like where you live you might have to replace appliances right away or do other improvements right away to make the home livable. So, the more you can save the better in this case.

4. Know that you NEED to do your Homework & Ask A lot of Questions. Buying a home requires a lot of information I have learned. There's tons of forms to gather, paperwork to gather and then on top of that more to sign, etc. When buying a home after a short sale the rules are different than when you bought the first time. Do you home work!  Research your area, ask a lot of questions of your realtor & broker. Know that there isn't a silly question, and all the ones you do as will help to make things less complicated for you.

5. Be Ready for anything!
I'm always going to be on the side of encouragement and being positive when it comes to this process. But that doesn't mean you shouldn't be realistic as well. In this type of transaction anything can happen, closing dates can get pushed back, loans can fall through, interest rates can change from what you thought you'd get, etc.  I don't want you to think nothing will work out, but I'm just encouraging you to ask a lot of questions of your lender, broker, title company agents and realtors so that you are prepared for anything that might happen.

Enjoy the process!
Buying a home can be stressful, time consuming and sometimes take longer than you think.
My last piece of advice is to enjoy the process whatever it is. If you're buying a home after a short sale history chances are you've already waited a long time to be in the buying position again. Know that you are blessed with this amazing opportunity, embrace it and enjoy it as much as you can.