This is a variation on the theme in the post below about the possibilities of getting a loan after a foreclosure or short sale. (The short answer is, “Not for a while.”)
The question I received was along these lines, “If I put down a very large down payment, could I get a loan to buy another home even though my current home will have to be a short sale?”
So I went back to the expert, Lonny Gibson.
The lenders have slammed the door shut on the “buy & bail” door last fall.
If you are buying a new home or owner occupied & you have a home currently to be rented or listed, the following rules apply, if you are not trying to qualify using both payments. (Existing & new home)
- You must have 30% equity in your current home
- You must have 6 months reserves in savings for both homes after close of escrow
- You must have an executed lease in place prior to close of escrow
Sorry I could not be more help
Lonny K. Gibson
Core Mortgage Group
15333 North Pima Road # 300
Scottsdale, Az 85260
This strategy of buying a home at the new lower prices and then walking away from your old, expensive home, actually worked for quite a few months.
Ah yes, I remember those days!
You could get a loan to buy a second home even if you were way under water on your current home. The loan originators didn’t care because they were going to sell the new loan to Wall Street anyway… and Wall Street wanted those loans.