Last week, I touched upon the new HUD guidelines released which change certain requirements related to people who experienced an economic event during the great recession. These changes allow you to purchase a home much sooner than before, even if you short sold, went into pre-foreclosure, or foreclosed upon a house, so long as you meet certain criteria.

The old guidelines required you to wait 3 years after a short sale or pre-foreclosure before purchasing a new house with an FHA loan. But now, in as little as 12 months, you can purchase a new home. Now, before you get too excited, you need to be sure you meet the following criteria:

You suffered from an “economic event” which lasted at least 6 months. An economic event can be anything which either caused you to lose your job or caused your household income to drop by at least 20%. This event cannot be of your own doing, and must be documentable.

You have repaired your credit. This requirement is a little more subjective than the economic event requirement, as some lenders have different credit requirements than others. If you have questions about where your credit falls, it is always a good idea to contact a mortgage professional.

You have taken a housing counseling course. To take the housing counseling course, you need to sign up with a licensed counseling provider and sit in on the course. You cannot apply for a mortgage until that class has been completed.

If you fit these three criteria, or if you have questions about any of them, please contact me. And if you have anything to add about these new guidelines, please leave a comment.