Many strategic defaulters walked away from their investment properties or second homes. It is a common misconception that this blemish on their credit may inhibit a refinance of their primary residence.
If you walked away from an investment property or a second home and are considering refinancing your primary residence you do have options.
Loan options after a foreclosure:
1. VA loan after foreclosure
Va loans are more forgiving than other loans available. If you are an Active Duty Servicemember, Veteran, National Guard or Reserve member and had a foreclosure or short sale more than 2 years ago, you may be eligible for a very low rate refinance. It is important to note that you must not have had a previous foreclosure, deed in lieu or short sale on a VA loan.
2. FHA loan after foreclosure
FHA loans are also available to refinance into a lower rate after a foreclosure or short sale. There is a strict 3 year waiting period for these loans but you do not have to be a first time homebuyer. These rates are also some of the lowest available but they do come with monthly mortgage insurance payments which could raise your payment. It is important to note that you must not have had a foreclosure, deed in lieu or short sale on a previous FHA loan.
3. Jumbo loan after foreclosure. (Cash out available)
You would think that getting a Jumbo loan after foreclosure would be very difficult. Most banks won’t touch them. However, after searching high and low, we have found a portfolio loan program for jumbo loans between 300k and 5 Million. The main requirement is equity. You need at least 30% equity in the home to be considered. Also you need at least a 680 credit score. There is not a specific required waiting period after a foreclosure or short sale, it is case by case. Too many factors to write down so it’s best to contact us to find out if you are eligible for this loan. These loans also offer an interest only option and come in 5/1 ARM 7/1 ARM as well as a 10/1 ARM. Cash out is available. Rates range from 4.25%-5.95% Please contact Jonathan@afterforeclosure.com directly to discuss these specialty loan programs.
4. Refinance loan 1 day after foreclosure (Cash out available)
Available only in the states of CA and AZ. This loan program is unique and requires at least 25% equity, a 600 credit score and a good stable income. Cash out is available and the program comes in several different options. You can chose either a 3/1 ARM, 5/1 ARM or a 7/1 ARM with rates between 6.99% & 7.99% with a 2% funding fee.
If you are interested in speaking with a Loan Officer regarding refinancing your current home, please call or email us with the best phone number and email to reach you. We look forward to helping you achieve your financial goals after foreclosure.