My current home loan is with Bank Of America. i purchased for $126 and current appraisal is $90. when i purchased the home i was married, we’ve been separated since 2007 and i was left with the mortgage and car note. my income is decreasing and ive ask B of A for help, but they have denied me. i have never been late on my mortgage and my credit is good. i am interested in a short sale, but i was told that, doing so can ruin my credit and i may not be approved for another home.
I dont want to foreclose on my home, but i need to move, what should i do to get a pre-approval letter for the second home before, the short sale or the foreclosure starts? please help me.
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The best person to ask is going to be the mortgage broker you will work with on your new mortgage. Even with a pre-approval letter that does not mean that you will not be asked about the disposition of your old house before you close. And the short sale could negatively impact your credit report depending on how it is reported. Goodness knows we’ve seen enough credit reports take a hit just with the reporting of a loan modification.
You’d probably need to qualify for the new mortgage and close before the old mortgage turns bad. But that’s just my guess.
Like I suggested, the mortgage broker you will work with is in a better position to know what the underwriting criteria is going to be for the loan company the broker will work with to get you approved.
P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.