Published On: December 27, 2013

Thousands who have faced foreclosure in the past wonder “how long do I have to wait before I can buy a new home”?

Unfortunately the answer is not simple and changes regularly.

Bully tactics used to scare or coerce buyers.

For several years I have been explaining that no one can predict the length of time that FHA, Fannie Mae or HUD, or a specific lender will require a homeowner to wait to qualify for a new home loan after a prior foreclosure, short sale or bankruptcy.  Realtors try to scare people into thinking that these periods are set in stone.  This is simply not true.

Realtors, brokers and lenders make a commission when you finance a new home. They have no incentive to make sure you can actually afford the loan.

Think about the information you are giving this stranger: all your financial information, your children’s names, bank accounts and your social security number. You do this without the slightest guarantee that the information will be kept safe.

Usually about every two to three years one or all of these agencies change their policies.   To support my statement in August of 2013, the Federal Housing Administration (FHA) announced its Back to Work Program.  This program looks at the extenuating circumstances that a homeowner faced prior to a foreclosure, short sale or bankruptcy.  In some very limited cases this program will shorten the waiting period for home buyers to one year from two to seven years.

To qualify for the program, home buyers need to show proof that that they suffered an economic event that resulted in a loss of 20% or more of their income for a period of six months or more, and that they have fully recovered financially from this event. In addition, participants must have received counseling from a U.S. Department of Housing and Urban Development (HUD)-approved agency.

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This is just one of many programs that exist, or will exist over the next several years.  Don’t let anyone tell you that administrative procedures or law never change.

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By |Published On: December 27th, 2013|Last Updated: June 19th, 2022|

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About the Author: Diane Drain

Diane is a well respected Arizona bankruptcy and foreclosure attorney. As a retired law professor, she believes in offering everyone, not just her clients, advice about bankruptcy and Arizona foreclosure laws. Diane is also a mentor to hundreds of Arizona attorneys.

*Important Note from Diane: Everything on this web site is offered for educational purposes only and not intended to provide legal advice, nor create an attorney client relationship between you, me, or the author of any article. Information in this web site should not be used as a substitute for competent legal advice from an attorney familiar with your personal circumstances and licensed to practice law in your state. Make sure to check out their reviews.*

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You and Jay are the best attorneys I have ever had or needed and thank God for the Honorable Robert Gottsfield in recommending you folks – I would have never made it through the entire process without you and Jay and God Bless you both always and stay in touch as well. You folks are the BEST OF THE BEST in Arizona.

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I can’t say enough good things about Diane. The way she handled my not typical circumstances was amazing. I was very nervous to start the bankruptcy process but Diane just has a very comforting way of explaining the whole process. My only regret is that I didn’t find Diane sooner. If you find yourself in a financial situation that you can’t correct on your own, please Call Diane Drain as soon as possible.

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