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Getting a New VA Loan After a Short Sale

How soon can you buy a home after a short sale using a VA loan?How soon can you buy a home after a short sale using a VA loan?

VA loans offer much simpler guidelines for buying after a short sale than other loan programs. In addition to not needing a down payment, you do not have to pay mortgage insurance with a VA loan. The home must be for the purchase of your primary residence, as opposed to an investment property.

The waiting period to obtain a VA loan after a short sale is typically 2 years. If you have late payments prior to the short sale, most banks will expect you to wait 2 years and have no late payments on your credit cards in the last 12 months prior to applying for a VA loan.

However, there are cases where veterans can get another VA loan within a year after a short sale. Veterans who have paid their mortgage for the 12 months prior to the short sale and have a 660 or higher credit score may be eligible for a VA loan immediately following a short sale if the short sale is recorded as being paid in full on the credit report.

VA Loan Requirements:

As with applying for any type of loan, you will need to show proof of income and have good credit.

To be approved for the new VA home loan:

  • You must maintain good credit after the short sale
  • You must re-confirm eligibility by applying for an updated Certificate of Eligibility (COE) with a VA Form 26-1880.
  • The short sale must not have been performed in order to make a strategic sale
  • You must not purchase a similar or superior property within a realistic commuting distance, generally measured to be 50 miles

For more information, visit our page on VA Loans.

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