So you’ve had to short sale your home. You’re worried the short sale will prevent you from buying a home again. Well, you may be in luck. Using an FHA insured loan you may be eligible to buy a home the very next day. Here is what HUD has to say about short sales and buying again:
…borrowers are considered eligible for a new FHA-insured mortgage if: 1) they were current on their previous mortgage and other debts at the time of the short sale and 2) if the proceeds from the short sale serve as payment in full.
We also stated that borrowers are not eligible for a new FHA mortgage if they pursued a short sale agreement to take advantage of declining market conditions, or to purchase another property at a reduced price.
Additionally, borrowers who execute a short sale while in default on their mortgage are not eligible for a FHA-insured mortgage for three years from the date of the sale.
Lenders, however, can make exceptions if the default was due to circumstances beyond the borrower’s control, such as the death of the primary wage earner.
So as long as you were current on your former mortgage and other debt, and not in foreclosure, than you are immediately eligible for an FHA insured loan.