The often heralded minimum two- or three-year wait time to purchase another home after a short sale is not written in stone. New lending programs, designed specifically for those who experienced a short sale or foreclosure, reduces this wait to a year or even as little as a day.
However, many do not know such programs exist and incorrectly believe that their only choice is to rent, according to Rick Piette of Premier Mortgage Lending, a full-service lender based in Las Vegas that serves the greater Las Vegas area.
“Nevada was hit hard when our housing market tumbled with thousands losing their homes to a short sale or foreclosure. Many were told that renting would be their only option for at least two or three years because lenders have to follow government guidelines, the GSEs (government-sponsored enterprises standards). So they packed up and found a place to rent,” Piette said.
“This is just no longer true and many people have a choice. You can choose a mortgage program that follows the GSEs guidelines and requires waiting for two- or three years after a short sale and even longer after a foreclosure. Or, you can choose a program like the Federal Housing Administration’s new ‘Back to Work’ mortgage program, that reduces the wait to a year, or the private Another Chance Nevada program, which cuts the wait down to as little as a day.”
Piette said although each program reopens the doors to homeownership, they have distinct differences.
The Back to Work — Extenuating Circumstances program was introduced by the FHA in August. According to Piette, the program is designed for those whose short sale or foreclosure was a result of a financial hardship such as a 20 percent loss of income or loss of a employment, and this “economic event must be proved.” Among the requirements is that the borrower has financially recovered by showing 12 months of timely payments and meets Housing and Urban Development requirements for an FHA-insured mortgage.
Another Chance Nevada was launched by Premier Mortgage Lending two years ago and does not follow GSEs or HUD requirements. Private and institutional portfolio lenders offer 15- or 30-year, fixed-rate loans at interest rates typically higher than traditional mortgage rates. At least a 20 percent down payment is required, which can come from personal funds or be obtained as a gift from family members. Borrowers may close within 30 days from the time of loan approval. The loan may be refinanced at any time without penalty.
Hundreds of Southern Nevadans have used an Another Chance Nevada loan on the purchase of a resale or a new home. The lender is working with Beazer Homes, D.R. Horton, Dunhill Homes, Harmony Homes, KB Home, Pardee Homes, Pulte Homes and Del Webb, Richmond American Homes, Ryland Homes and William Lyon Homes.
“Both of these programs will help thousands who lost their homes by offering them the opportunity to choose how and where to live. Another Chance Nevada follows an individualized approach to lending because we don’t have to follow HUD requirements like the Back to Work program or the GSEs like conventional lenders and treat you as an individual knowing that each person’s situation is unique,” Piette said.
The first step to determining one’s mortgage program options is to meet with a full-service lender and go through the mortgage prequalification process.
For additional information, call Premier Mortgage Lending at 702-485-6600 or visit www.AnotherChanceNevada.com. Premier Mortgage Lending, NMLS #393282, is at 8689 W. Sahara Ave., Suite 100.