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Foreclosed homeowners get chance to buy again

Posted by Scott Van Voorhis August 21, 2013 07:16 AM

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If you lost your home in a foreclosure or short sale, Uncle Sam says you deserve a second chance.

Forget about waiting three to seven years after losing your house to qualify for a government-backed mortgage. Let's face it, 2020 is a long time to wait in our increasingly boom/bust housing market.

The FHA has reduced the waiting period to just 12 months - provided you can show you lost your home due to an "economic event" stemming from the recession.

Before you can get a green light, you have to show you've not been late on your rent over the past year and take a housing counseling course, among other requirements.

But then you are ready to hit the open house circuit - just in time to get caught up in another round of crazy home prices!

Sarcasm aside, on the face of it, the new FHA rules seem fair enough to me. Most of us know someone who lost their job or took a hit of some sort during the recession. And few homeowners escaped the housing crash completely unscathed, even if they managed to hang onto their homes.

Still, I wonder whether this opens the door to a new wave of subprime lenders eager to cash in on home buyers with blemished records.

After all, no matter how well-intentioned a particular government program or initiative might be, there is too often sort of quasi scam artist or shady operator lurking, ready to take advantage of it.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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About boston real estate now
Scott Van Voorhis is a freelance writer who specializes in real estate and business issues.

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