In August of 2014 this year, Fannie May changed their guidelines. For homeowners who have had a short sale, in the past, the guidelines made homeowners wait two years if the were putting down 20 percent and four years if you were putting down 10 percent. However, this August, the guideline has now been changed to four years regardless of how much you are putting down.
Watch the full video to learn more:
At United Mortgage Financial Group, we are happy to answer any questions only on short sales and these new guidelines by Fannie May. Also, if you have questions about foreclosures, bankruptcy, or conventional loans call our office number which is 480‑503-3533. email Mike at mike.goblet@umfgimc.com
Matt O’Brien: Welcome to another segment of Arizona Mortgage. We’re here with our resident expert Mike Goblet of United Mortgage and Financial Group. Good morning, Mike.
Mike Goblet: Good morning, Matt. How are you this morning?
Matt: Not too bad, looking forward to a little rain in the Arizona area here. How about you?
Mike: Yes, very much so, but obviously rain in Arizona at this point is becoming scary at times.
Matt: Yes, exactly, biblical in nature.
Mike: Yes, we’re having once in 500 years floods like every other week now.
Matt: Just don’t have a house in a flood zone. So, speaking of real estate, you have a question that was brought in regarding new changes to guidelines if you’ve had a short sale.
Mike: I’ve talked in the past about if you had of got a short sale in your background, about how quickly you get back in the market.
In August of 2014 this year, Fannie May changed their guidelines. The old guideline was you had to wait two years if you were putting down 20 percent and four years if you were putting down 10 percent, before you would qualify for a Fannie or Freddy loan, which is essentially a conventional loan.
They have changed that in August and now the wait there’s four years regardless of how much you are putting down. It didn’t get better, it got a little tighter.
Matt: What do you think that’s because of?
Mike: Not really sure, just another thing of a loop that they want to close in terms of what they call risk factor. Anybody who’s had a short sale, they rate as having being a greater risk to do it in the future. It’s just a risk management thing on their part.
Now, if you’ve had a short sale, that still doesn’t preclude you from maybe qualifying for an FHM loan, where the wait is three years, or VA loan, if you qualify for those parameters, where the wait is two years. There are still actions available, but the conventional low guideline got a little tighter.
Matt: Make sense, seems to be the trend in the banking industry these days.
Mike: Actually, it’s interesting that there are some changes going on that are getting a little looser. This has really caught a lot of people by surprise that they were tightening it, because of how long they’ve been doing the two years with 20 percent down.
It should make it a lot riskier, but there’s no necessary accounting for their decision making.
Matt: Are these changes in full effect now or are they hitting on a certain day?
Mike: They are in full effect now. A conventional loan, the wait is four years regardless of how much money you’re putting down. You got to be putting down 70 percent, but it still going to be a four year wait if you’ve had a short sale. But, let’s look at VA or FHA if that’s still something you want to do.
Matt: That makes sense. People out there have a question, Mike. What’s the best way to get in touch with you?
Mike: I’m happy to answer any questions only on short sales, but foreclosure, bankruptcy, or more importantly just a good conventional loan first loan borrower or if you have any questions, reach me, you can call me at our office number which is 480‑5033533. Call me on my cell at 480‑2202329 or email me at mike.goblet@umfgimc.com.
Matt: Excellent, thanks for enlightening us once again, Mike. We look forward to another segment. Hopefully you stay dry and clear of the cyclone coming through.
Mike: You too, Matt. Don’t drive up too any washes that are running.
Matt: No. I don’t want to get the idiot driver locked onto my face.
Mike: Take care and look forward to talking to you soon.
Matt: You too, Mike. Thanks.
Mike: Bye.
