Common challenges
Borrowers mix up which clock applies: each program has its own waiting period and its own definition of extenuating circumstances, and many wait longer than required.
Programs that fit
FHA Loans
An FHA loan is a government-insured mortgage that allows 3.5% down with a credit score of 580 or higher, or 10% down with a score from 500 to 579.
VA Loans
A VA loan is a mortgage guaranteed by the Department of Veterans Affairs that lets eligible veterans, active-duty service members and certain surviving spouses buy with no down payment and no monthly mortgage insurance.
Conventional Loans
A conventional loan is a mortgage not insured by the government that follows Fannie Mae or Freddie Mac guidelines.
Non-QM Loans
A non-QM (non-qualified mortgage) loan is any mortgage that documents income or credit outside the standard Qualified Mortgage rules, using bank statements, a P&L, 1099s, assets or rent instead of W-2s and tax returns.
Tips before you apply
- Mark the exact closing date of the short sale, that is when every waiting-period clock starts.
- Extenuating circumstances (job loss, medical events beyond your control) can shorten conventional waits; document them thoroughly.
- Some non-QM programs lend sooner than agency minimums, at higher rates and down payments.
FAQ
What is the best mortgage for after a short sale?
It depends on your documentation and goal. The programs that most often fit are FHA Loans, VA Loans, Conventional Loans, Non-QM Loans.