Short Sales and Foreclosures – What Effect do They Have on Your Future? Part 7 of of you Owe More on Your Orange County, CA Home than It’s Worth, & You Don’t Know What to Do

Short Sales and Foreclosures – What Effect do They Have on Your Future? Part 7 of of you Owe More on Your Orange County, CA Home than It’s Worth, & You Don’t Know What to Do.


This is a series for people who are “upside” down in their homes and looking to learn about their options.  For the the first three posts see You Owe More on Your Orange County, CA Home than It’s Worth & You Don’t Know What to Do

Reinstatement & Forbearance 

Loan Modifications and Obama’s Making Home Affordable 

Obama’s Making Home Affordable Refinance Program.

Short Sales – What are They and Can You Get One?

Foreclosure and Deed in Lieu of Foreclosure.

Options to Foreclosure in Orange County

In my last post, I discussed the timeline of foreclosures for Orange County, CA homes and also discussed deed in lieu of foreclosure.

Today, I’m going to discuss the consequences of short sales and foreclosures to your future.

How long before you can buy a new Orange County, CA home after a foreclosure or short sale?

According to Fannie Mae, if you have had a short sale, they’ll allow you to obtain a loan on an Orange County, CA home if you meet all other qualifications 2 years after a short sale.

If you have a foreclosure, Fannie Mae will not give you a loan for 5 to 7 years after a foreclosure.  Why is this important? Fannie Mae and Freddie Mac are psuedo government entities that purchase a tremendous number of loans and many loans are reviewed with an eye to their guidelines.

According to Lynn Nelson of Met Life Home Loans, you should be able to obtain an FHA loan between 2 and 3 years after a short sale with new established credit and old credit in good standing.

What about credit?

The answer with short sales is, it depends.  It depends on how the bank reports the short sale.  It depends on how many lates, if any, you had when the short sale was completed.  It will effect your credit.  However, based on the conversations I have had with credit specialists, the effect will be much less than a foreclosure, partially because there is not currently a box for short sales on credit like there is for foreclosures.

It seems that many people believe that people who do a short sale on an Orange County, CA home are being more responsible than those who have a foreclosure and are therefore treating them differently. 

Next time, I’ll discuss short pay refis.  What are they?  Do you qualify?



We know what your options are when you owe more on your home than it’s worth and don’t know what to do, and we will share it with you over the next few weeks.

If you want to make sure not to miss any of this series, please subscribe to this blog to learn your options.

If you have questions in the meantime, please contact Christine Donovan at 714-319-9751 or e-mail Me!


About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.

Are you upside down in your home? Do you owe more on your Orange County home than it’s worth, and you don’t know what to do? Are you concerned about making your mortgage payment? Contact me at or 714-319-9751 to discuss your options.

Want to buy a home or to list your property for sale in Newport Beach, Costa Mesa, Huntington Beach or Orange County? Contact me at or 714-319-9751 to learn about our system which will make your buying and selling experience easier.

Disclaimer: All information in this blog is deemed reliable but is subject to change at any time and is not guaranteed to be accurate nor are there any warantees either express or implied. This blog is not intended to offer any legal, tax or other advice.

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Copyright © 2009 by Christine Donovan, All Rights Reserved.

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