Short Sale Tradeline

Hi Paul,

I had a short-sale close in Sept 2008.  The loan amount showed on 2 of the 3 credit agencies.  I did receive a document from Countrywide that it was forgiven.  How do I get the other 2 agencies to remove this as Experian was the only one who did.

Also, when can I apply for another home loan.  My FICO is 626.  I also have debt that needs to be brought down but I don’t know how fast I can get that done.

Thanks for being here for all of us in this nightmare.

Rosanne

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Hi Rosanne,

You’ve got until September 2009 to pester Countrywide via a Qualified Written Request and you also have the FCRA if the settled tradeline is not ‘complete and accurate’.  Generally, the tradeline remains on the report, but is listed as ‘settled for lesser than amount’ and has a zero balance.  The ‘forgiven’ means that the lender is not pursuing continued collection; however, as I mentioned the tradeline doesn’t go away, unless it was a rescinded loan under the TILA and in that case, the settlement could be a short sale with full release of liability with the trandeline permanently redacted with forward flow from the credit report.

It is normally a two year wait to obtain another FNMA loan after a short sale whereas a foreclosure requires a five year wait under those same guidelines.  FHA requires a three year wait from the date the balance is zero and in the case of a foreclosure where the property doesn’t sell for enough to cover the balance, that clock never starts ticking.

Thanks for the questions and hope this helps.

Paul

This author is not an attorney and this information should not be considered legal advice.  Please consult an attorney for legal advice.