In Massachusetts, most of foreclosures are non judicial requiring no court intervention to be carried out thus closing out the door for redeeming the house after the foreclosure. However, judicial foreclosure also exists and gives the soonest chance to repurchase or rather redeem your home after foreclosure by paying the total amounts outstanding, interest charges, attorney fees and costs. This right diminishes if the lender keeps the possession of the home for three years. (Mass Gen. laws Ch.244 & 18, 19).
Foreclosure wrecks your credit score for the next seven years after the foreclosure limiting the availability and/or increasing the cost of obtaining another mortgage. Depending on the type of mortgage suppliers available, it will determine how soon you can be able to buy a new home. For example, banks can generally offer mortgage to anyone they choose based on their set forth guidelines because people have different risk profiles. The following governmental organizations though they do not directly provide finances to borrowers, they are regulating bodies that work with the lenders as loans guarantors and ease up money in order to increase mortgage supplies, they include: Fannie Mae, Freddie Mac and FHA and they offer the following guidelines when considering a loan after a foreclosure:
a)Foreclosure with an FHA Loan
The borrower is expected to wait for three years before being able to obtain a new loan. However this waiting can be reduced if the individual has established a good quality credit or is showing justifying conditions.
b)Foreclosure with a Fannie Mae Loan
To wait for the next 7 years after the foreclosure sale date, 3 year wait if the borrower demonstrates extenuating conditions, additional underwriting requirements apply 4 years after a 3 year wait period and 7 year wait for a second home, cash out re-financing, or an investment property.
c)Foreclosure with a Freddie Mac Loan
Wait for the 5 next years after the conclusion date of the foreclosure and a 3 year wait for a borrower showing extenuating state of affairs.
In the view of the new owner or an investor
The following are the times you can buy:
In the pre-foreclosure period, you carry an independent due diligence so to ensure no liens exist on the property. The owner signs over the deed to you giving you title to the property and since you are acquiring a mortgage, you must bring it current by giving the mortgage provider the missed payments.
Purchasing at an auction bears the most risks but promises huge benefits since in most cases you may not inspect the property before the scheduled auction date and the fact that it is a capital intensive as you are required to demonstrate the ability to conclude the purchase.
Buying real estate owned (which is after the bank has foreclosed) is the least risky undertaking because the bank or mortgage servicer has acquired the property and has cleared all liens through the purchase. You get a cleared title and which is allowed to have a mortgage contingency.
Sources
www.nolo.com/legal-encyclopedia/if-i-loose-home-foreclosure-massachusetts-can-i-back.html
www.sellmyhomeinmetrowestma.com/Buying-a-foreclosure/page_2234424.html
massrealestatenews.com/buying-a-h