Can I rent my house and apply for a loan on a short sale?

Property valued at $290,000. If I can get it for $180,000 through $220,000. I have bad credit, my income is $52,000 tax free pension.

Asked by JOSE BALLARD

2 Answers

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Answered by Chad Freeman, Branch ManagerPRO+ in Bethesda, MD
Jose:

Thanks for your question. There is nothing stopping you from doing either. However be advised that 1) There are specific guidelines for renting your home and being able to use that rental income towards your new purchase, 2) In general buyers need good credit these days to purchase a home but that is even more emphasized when it is short sale, and 3) Short sales can take a while to close.

Good luck. | 08.22.14 @ 20:04
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$commenter.renderDisplayableName() — {comment} | 12.09.16 @ 13:44
Answered by Ted Rood, Mortgage BrokerPRO+ in Maryland Heights, MO
Hi Jose. "Bad credit" means different things to different people, but if your scores are below 580-600, you will not meet the guidelines for conforming or FHA loans. Your debt to income ratios may be a concern as well, depending on the down payment and taxes on the new house and your current debt load. Bottom line, I wouldn't pursue a deal just because "I may get it below market value", as that's certainly not assured. Start with your scores, until you know them (as pulled by a mortgage company, not Credit Karma, etc) it's all guesswork on both your end and ours. | 09.22.15 @ 06:15
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$commenter.renderDisplayableName() — {comment} | 12.09.16 @ 13:44
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