Fannie Mae Cuts Waiting Period for New Mortgages

Borrowers who previously experienced a deed-in-lieu of foreclosure will not have to wait as long to get approved for a new mortgage loan. Mid April, Fannie Mae changed it required waiting period to reflect the current market conditions. In the past, borrowers had to wait four years after a deed-in-lieu of foreclosure to get approved for a mortgage with Fannie Mae. That time period has just been reduced to just two years. The maximum loan-to-value is limited to 80% and after four years the maximum loan-to-value raises to 90%. Pre-foreclosure sales and short sales will also have a two year waiting period with the same loan-to-value requirements.

In all cases, borrowers must re-establish their credit, which means they must meet minimum credit scores and eligibility requirements.