Orange County VA Home Loans After Foreclosure or Short Sale

Orange County Veterans who have had a short sale are able to purchase a home with $0 down immediately after the short sale. Veterans who have had a foreclosure need to wait two years. VA is relatively flexible in how they look at foreclosures and short sales, compared to FHA and Fannie Mae.

Short Sale versus Foreclosure

A short sale occurs when a home owner sells their home, even though they owe more than the home is worth. Their Orange County home loan lender needs to sign off on the home sale, since it is the bank who will be taking a loss on the property if it is sold.  A short sale can help to preserve a home owners credit compared to going through a full fledged foreclosure. FHA typically requires 3 years after a foreclosure or short sale, unless extenuating circumstances can be proved as the reason for the short sale.  Fannie Mae requires between 4 and 5 years after a foreclosure, but will lend to 80% of the properties value only two years after a short sale. But VA, at least for those that are eligible, will lend to 100% of the properties value up to the county VA loan limits. The VA Loan limits in Orange and Los Angeles counties, the $0 down loan limit is $679,650 in 2018.

Veterans Need Perfect Credit After Foreclosure or Short Sale

The only catch is that the Orange County veteran will need perfect credit since the short sale or foreclosure.  Especially over the most recent 12 months. Many times, leading up to the short sale, the seller may have multiple mortgage lates, possibly 90 or 120 day lates. This can really weigh the credit report down and hurt the FICO score. This is why it is important to reestablish credit immediately after the short sale, or foreclosure, and n0t have any more lates after the sale of the home.

Quick Way to Find if you are Qualified for a VA Home Loan in Orange County, California

It is always important to get PreApproved for a VA loan prior to make an offer on a home. It is probably even more important to do after a short sale or foreclosure. Find a reputable VA loan expert in Orange County, CA, and have them prepare personalized VA loan scenarios which will give a breakdown of the purchase price, loan amount, closing costs, and amount needed to close. The VA loan officer can get the Automated Loan Approval, which is an important step in determining early on whether you can get a VA home loan to purchase a home. The key is to make sure to find someone with experience to get them job done easily and quickly,

Authored by Tim Storm, an Orange County, CA  VA Loan Officer – Please contact my office at Home Point Financial for more information about an Orange County, CA home loan.  949-640-3102. MLO 223456

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