Buying Scottsdale Homes For Sale Following Foreclosure

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Some Scottsdale homes for sale are foreclosed homes. There are some ways for picking the financial pieces up, sort through them on your own and then put the pieces back together.

Have Patience

Surely, it will be challenging to get a new mortgage to buy one of the available Scottsdale homes for sale with your credit record stained by the foreclosure and the majority of lenders set a waiting period. Such period tends to vary depending upon whether your applied loan is government-insured or traditional. Typically, FHA is little more lenient with those who have undergone foreclosure.

A new FHA loan’s waiting period is usually three years unless the applicant can prove to his lender that the foreclosure took place through no fault of his own. In such case, the lender reduces the waiting period to just a year in the program Back to Work Extenuating Circumstance of the Department of Housing and Urban Development. It is imperative to prove that the factors that lead up to the foreclosure decreased the income of the applicant by 20% or more for a minimum of 6 months.

The HUD wishes to see complete recovery from what caused the foreclosure, thus, you will have to keep up with bill and rent payments during the waiting period. Also, you will have to take part in a housing counseling session thirty days before the loan application.

Loan applicants who have foreclosure records are required by Fannie Mae and Freddie Mac to wait 7 years. They also have an extenuating circumstance program; however, it has longer waiting period.

A traditional lender offers a mortgage loan a day out of foreclosure for properties in some states only which do not include Scottsdale. But, the requirements are really steep. In order to get this financing, it is imperative for the applicant to:

• Have enough funds reserved in his bank for meeting 6 months of loan payments.
• Take out at least $100,000 loan.
• Make a down payment of 25$.
• Have at least 600 FICO score.

Becoming Less of a Risk

Even those who have not undergone foreclosure are likely to be regarded as a risk to lenders. Often, poor credit is the culprit, thus, use the waiting period to fix your credit. Create a history of paying on time and do not miss a payment.

After you have recovered from your unmanageable house payments, forget about getting spending your extra money on other expensive things. Keep in mind that taking on a new debt will throw your DTI or debt-to-income ratio out of the track and a lender is likely to see you too risky for a loan which reduces your chances of owning any of the Scottsdale homes for sale out there.

Saving your Money

These days, lenders require you to make a down payment on a house unless you use a VA-backed loan or get a low-income loan. The lowest down payment for the FHA is 3.5% of the total loan amount. With a traditional loan, you will have to provide at least 20%.

Getting Loan Pre-Approval

Typically, the home buying process starts with this. For homeowners coming out of foreclosure, it takes place when your ducks are in a row:

• Your credit has been cleaned up.
• You have completed the waiting period
• You have enough money for a down payment.

After getting pre-approval, you can contact a real estate agent to start finding Scottsdale homes for sale. soon, you will own a home again.

To learn more about amazing SCOTTSDALE HOMES FOR SALE? Please contact real estate expert Jen Wehner today at 480-748-6925 or email Jennifer@JenniferWehner.com.