What are the long-term effects of a short sale?

Whether you’re considering a short sale or you’ve just gone through one, it’s time to take a deep breath and take stock of where you stand today. You’re clearly not the only one in the short sale boat. But do you ever get that feeling when everyone around you is going through something like a short sale, a yearly physical, sitting at the DMV, or filing taxes, that you have no idea how everyone is getting through this painful and frustrating experience? You know, that, “am I doing something wrong because this really sucks?” feeling? Then yea, you’re likely experiencing exactly what everyone else is going through.

But hey, after coming to terms with dealing with the whole short sale chaos, you’re probably now wondering “what now”? A short sale can really be a blessing in a barbed-wire disguise. If you’ve completed the process in Arizona you are likely in the free and clear of any debt associated with the home (don’t take my word as the final word on this one, check with your lawyer) and now able to sort through what is truly important in your life.

Unless Mom and Dad are willing and able to take you and all of your stuff in, you will undoubtedly be renting your next place. Don’t let the circumstances that caused you to short sale your home scare you away from homeownership forever, learn from it. Plus a few years dealing with landlords or apartment complexes will have you marking the days on your calendar until you can buy your next home. As of now the Federal Housing Agency (FHA) are extending new home loans to those who have had a short sale just two to three years after the finalization of the sale. Seriously! Conventional financing is also available but you’ll have to wait a bit longer to qualify for these, something more along the lines of five years or so.

The most important thing to remember if you are even remotely considering purchasing a home after you’ve had a short sale is to keep up your credit history by continuing to pay all of your other debt obligations. You’ll also want to save up cash for your down payment and be sure to save your canceled checks on your rent payments to show any future lender that you have a consistent and stellar payment history since the short sale.

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