From the Wisconsin Realtor’s Association (WRA) - Legal Hottips December 1, 2008:

Fannie Mae recently released updated underwriting guidelines for new mortgage loans that directly address individuals with various types of foreclosure history. Potential borrowers with:

a Foreclosure on their credit record must wait 5 years to be considered for new funding, and are subject to additional credit and down payment requirements for 5 to 7 years.

a Deed-in-lieu-of-foreclosure warrants a 4 year wait with additional requirements for 4 to 7 years.

Finally, the silver lining…

a Short Sale require only a 2 year wait with no additional requirements.

These new guidelines make short sales a more attractive option for homeowners…

This Wisconsin REALTORS® Association Best of the Legal Hotline service is provided for you by the WRA’s Legal Affairs Department. The service should be considered a general statement of applicable legal principles. Given this format, it is impossible to fully address all potential legal issues which might apply in any particular situation. A determination of any individual’s legal rights in a transaction can only be obtained after complete analysis of the law and its applicability to the particular fact situation.