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In a recent blog we discussed how the penalty phase between completing a short sale and getting a new conventional mortgage to buy a house increased in August from two years to four years.  If you had a short sale and bought a house prior to August 17, 2014, you were able to complete the purchase under the old, less stringent criteria.  If you completed a short sale at any time, now you must wait four years to qualify for a new conventional mortgage.

It’s not only people who completed a short sale who are having trouble qualifying for new loans.  Currently over 50 percent of people who apply for a mortgage are not approved.  This does not necessarily mean the people being turned down don’t have a down payment or the income to pay a mortgage.  For whatever reason, they do not meet the underwriting criteria to obtain a mortgage.  Banks are cherry picking the applicants and keeping underwriting criteria stringent.  Are there any other alternatives?

Yes, indeed, there are options for the large numbers of people turned down for a home mortgage.  Owners of homes which are owned free and clear may sell their houses and be the “bank” by holding the mortgage.  Investors who want to earn more than 1 percent on their money are offering mortgages to home buyers.  Owners of homes with no equity are making their low interest loans available to home buyers, with a delayed closing allowing time for the equity to build and the loan to be paid down.  There are so many ways for buyers who are turned down by the banks to still achieve the goal of home ownership.

Text Buy to 702-401-2349 and Lisa will provide you with more information about how you can buy a home.

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