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can i get a new mortgage if old/current mortgage has a second showing charged off?

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StartingOver10
Moderator Emerita

Re: can i get a new mortgage if old/current mortgage has a second showing charged off?


@djc225 wrote:

never in bankruptcy.  i will settle this for the amount they are asking and they will release the lein. But the remarke on the credit report will say "settled for less than full balance".  I'm told by a lender that these remarks will stop my ability to get a new FHA loan, as they will consider this settlement in the same manner they would a short sale.  


The settlement payment and release will start the clock for you to begin to be able to get a new FHA loan. Without taking care of the second - you won't be able to get a new loan (except hard money type).

 

When you take care of it and get the release recorded, that is when you will begin to 'heal'.  Various derogatory types of mortgages (short sale, foreclosure, Bankruptcy) have different waiting periods depending upon down payment and loan type. FHA waiting periods are generally short, unless you have a large amount to put down on the next property. 

 

Some of these waiting periods are shorter now than they were even just 5 years ago. But you have to start the clock on your waiting period. I think it is an excellent idea that you are settling and getting a release (the release is critical).

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