How to buy a home after foreclosure

A foreclosure can be devastating, but it doesn’t have to be the end of your homeownership journey. With time, credit repair, and a better understanding of the mortgage landscape, you can buy a home again.

In fact, a growing group known as “boomerang buyers”—people who lost their homes to foreclosure or short sale during the housing crash—are reentering the market.

Can You Buy a House After a Foreclosure?

If you’ve been through a foreclosure, you might wonder whether owning a home is still in your future. The good news? Buying a house again is possible—with a little time, patience, and the right financial steps. Here’s what you need to know as you start rebuilding and planning your next move.

Why Foreclosure Doesn’t Mean Forever

Even the most financially responsible individuals can fall into foreclosure. The 2007–2014 housing crisis led to 7.3 million foreclosures nationwide. Now, many of those affected are passing the seven-year mark that’s often required to recover their credit and become eligible to purchase again.

“Having a foreclosure, bankruptcy, or short sale hit their credit score and did some damage, so it’s about reestablishing credit and waiting out that period to buy again,” said Rob Mehta, director of strategic planning and business development at Coldwell Banker Burnet.

The Rise of Boomerang Buyers

More buyers are becoming eligible each year, and lenders are increasingly open to helping those with a foreclosure in their past. Many of these buyers are eager to stop renting and start building equity again.

“We’re definitely seeing those folks reentering the market and wanting to purchase again because they don’t want to rent; that’s not their long-term goal. They want to own again. They want equity,” Mehta said.

How Long Do You Have to Wait to Buy a House After Foreclosure?

The timeline for buying a home after foreclosure varies, and understanding the rules can help you plan ahead. While it may feel like you’re stuck in limbo, each mortgage type has its own requirements, and some offer faster paths back to homeownership than others.

Mortgage Waiting Periods by Loan Type

Waiting periods vary depending on the type of mortgage, and they typically begin after the foreclosure is officially completed, not when you vacate the property. These timeframes are in place to give lenders confidence that you’ve had enough time to stabilize your finances and rebuild your credit profile. Some loan types are more forgiving, while others require a longer track record of financial recovery.

• Conventional Loans (Fannie Mae and Freddie Mac-backed): These are standard mortgage loans that aren’t insured by the government. They generally have the strictest criteria and require a waiting period of seven years from the completion of your foreclosure.
• FHA Loans (Federal Housing Administration): Designed for lower- to moderate-income borrowers, FHA loans are more accessible due to relaxed credit score requirements. The typical waiting period is three years after foreclosure.
• VA Loans (U.S. Department of Veterans Affairs): These loans are available to eligible veterans, active-duty service members, and some surviving spouses. VA loans offer competitive interest rates and require only a two-year waiting period post-foreclosure.
• Jumbo Loans: These are non-conforming loans that exceed the limits set by Fannie Mae and Freddie Mac, typically used for high-value properties. Because of the larger loan amounts and increased risk, jumbo loans often require a waiting period of seven years or more after foreclosure.

What Counts as an Extenuating Circumstance?

Some lenders may shorten waiting periods if your foreclosure was due to circumstances beyond your control, commonly known as “extenuating circumstances.” These might include a death in the immediate family, serious illness or injury, sudden job loss due to company downsizing, or a natural disaster that impacted your financial stability. To qualify for this exception, you’ll typically need to provide documentation supporting the event and demonstrate how it directly contributed to the foreclosure. Each case is reviewed individually by a loan underwriter, who will determine whether the situation warrants a reduced waiting period.

Tips for Navigating Post-Foreclosure Timelines

Understanding your loan options and timelines can help you strategically plan your return to homeownership. The earlier you start, the better positioned you’ll be when the waiting period ends. Take this time to learn the differences between loan types, explore what lenders require, and map out a financial plan to reach your goal. Begin rebuilding credit and gathering documentation—such as income verification, proof of savings, and explanations of your foreclosure—well in advance to avoid delays later.

What Are the Best Loan Options After Foreclosure?

Once your waiting period is up and your credit is on the mend, it’s time to explore your mortgage options. Not all loans are created equal—some are tailored for borrowers with past credit issues, while others require a more robust financial profile. Understanding the differences can help you choose the loan that fits your current situation and long-term goals.

FHA Loans

FHA loans are often more accessible to borrowers with damaged credit histories. “FHA loans are typically thought of for folks with credit difficulties or an entry-level loan for those who haven’t established credit,” explained Jim Pomposelli, vice president of residential lending at Perl Mortgage, Inc.

These government-backed loans allow for lower down payments—sometimes as little as 3.5%—and offer more flexible credit score requirements. This makes them a popular choice for buyers rebuilding after foreclosure. However, Pomposelli noted that while FHA loans are more forgiving, they do come with trade-offs.

Borrowers are typically required to pay mortgage insurance premiums (MIP), which can significantly increase monthly costs, and there are limits on how much you can borrow based on your location.

VA Loans

Available two years after a foreclosure, VA loans—backed by the U.S. Department of Veterans Affairs—are a strong option for eligible veterans, active-duty service members, and certain surviving spouses. These loans come with several advantages, including no required down payment, no private mortgage insurance (PMI), and competitive interest rates.

VA loans are designed to make homeownership more accessible to those who have served, and their more flexible credit requirements can be particularly helpful for those recovering from a foreclosure. Additionally, closing costs are often lower and may be paid by the seller, making this a cost-effective path back to homeownership for those who qualify.

Conventional & Jumbo Loans

These loans require the longest waiting periods and stricter credit requirements but may offer better long-term value in terms of interest rates, loan terms, and reduced mortgage insurance obligations. Conventional and jumbo loans are generally favored by borrowers with strong credit and stable income, and while they’re harder to qualify for post-foreclosure, they can be worth pursuing after rebuilding your financial profile. These loans may also allow for larger borrowing amounts and provide more flexibility in property types, especially at the high end of the market.

“What I’m seeing is, forget it if you’ve had a foreclosure,” Pomposelli said. “I was working with one client who just started a foreclosure. It never actually went all the way through, but it didn’t matter. Just the mere existence of the foreclosure basically kicked them out of being able to get the loan.”

How to Improve Your Credit Score After Foreclosure

To reestablish your credit, pay your bills on time, don’t max out your credit cards, and don’t take on significant new debt after your foreclosure. Hold off on applying for other financing, like car loans or furniture financing.

“If you have a foreclosure, you have to have perfect credit from thereafter,” Pomposelli said.

Any additional dings on your credit record, even late bill payments, can keep you from getting a new mortgage.

“It might have been something big in your life that happened and this is America and we forgive, but as my football coach used to say, ‘First time shame on you, second time shame on me.’ If you had a difficulty, and after it was cleared away you demonstrate that you can’t handle credit, they’re not going to give you more access,” Pomposelli said.

Smart Habits That Rebuild Credit

After foreclosure, it’s essential to demonstrate responsible credit behavior. Paying your bills on time is one of the biggest factors influencing your credit score, so make it a non-negotiable habit. Keep your credit card balances low—aim to use less than 30% of your available credit limit—and avoid taking on any large new debts unless necessary. It’s also a good idea to review your credit report regularly for errors and take steps to correct them, as inaccuracies can slow your progress.

Mistakes to Avoid That Can Set You Back

While rebuilding your credit takes time, one small slip can undo months of progress. “If you have a foreclosure, you have to have perfect credit from thereafter,” Pomposelli said. Even a single missed payment or a new account in collections can raise red flags for lenders. Avoid applying for unnecessary credit cards or loans during this period, and stay current on all financial obligations, including rent and utilities. Lenders will be especially cautious with applicants who show signs of repeated financial instability.

Pomposelli emphasized that lenders are cautious with repeat offenders: “If you had a difficulty, and after it was cleared away, you demonstrate that you can’t handle credit, they’re not going to give you more access.” Establishing a clean financial track record is critical to earning back their trust.

When to Start Applying Again

Once your waiting period ends and you’ve reestablished consistent financial habits, you’re in a good position to start exploring mortgage options. Begin by checking your credit score and reviewing your credit reports from all three major bureaus. Make sure your debt-to-income ratio is within a healthy range—ideally below 43%—and that you’ve saved enough for a down payment and closing costs. Getting pre-qualified with a lender can give you a clearer sense of what you can afford and what loan programs may be available to you. The more prepared and creditworthy you appear, the more likely you’ll be approved for a competitive mortgage.

Tips for Getting a Mortgage After Foreclosure

Even after rebuilding your credit and waiting out the required time period, securing a mortgage can still feel overwhelming. But the process doesn’t have to be daunting if you take the right steps in advance. From choosing the right lender to preparing your paperwork, these tips can help streamline your journey back to homeownership.

Shop Around for Forgiving Lenders

There are thousands of lending options—from local credit unions to national online lenders—and no two lenders assess risk exactly the same way. Some may specialize in working with borrowers who’ve had financial setbacks, while others may offer flexible underwriting guidelines or alternative credit review methods. Take time to research and compare offers, interest rates, fees, and eligibility requirements. You may be surprised by how much variation exists between lenders who seem similar on the surface.

“Reach out to your lender or bank and figure out what mortgage products are available,” Mehta said. “There are a lot of options for the consumer.”

Get Pre-Qualified Before House Hunting

Getting pre-qualified gives you a head start on your home search by helping you understand what type of loan you may qualify for and how much you can realistically borrow. It also shows sellers and real estate agents that you’re serious about buying, which can strengthen your negotiating position. During pre-qualification, your lender will review your financial background, including income, debt levels, and credit score, and give you an estimate of your purchasing power. While not a guarantee, it’s a smart first step before diving into listings.

Prepare Your Financial Paperwork Early

When you’re ready to apply for a mortgage, having your paperwork in order will make the process smoother and more efficient. Lenders will typically request several documents to assess your financial stability, including at least two years of tax returns, recent W-2s or 1099s, pay stubs, bank statements, and documentation for any large deposits or unusual transactions. You’ll also want to include a letter explaining the circumstances of your foreclosure and what you’ve done to regain financial footing since. Being proactive shows lenders that you’re organized, responsible, and ready to buy again.

The Bottom Line: Buying a Home Again Is Possible

Recovering from foreclosure takes time, effort, and patience—but it’s far from a dead end. With a strong credit recovery plan, the right mortgage product, and a solid understanding of the lending landscape, you can absolutely return to homeownership. As more lenders open their doors to boomerang buyers, the opportunity to buy again becomes increasingly realistic.

“It might not be as soon as you like,” Pomposelli said, “but all things considered, you can get into a home probably with a decent rate at a decent price in a reasonable amount of time. You just gotta buckle down and grin and bear it until you can get through some of this, but the system itself is pretty forgiving.”And when you’re ready to make the move, don’t forget to plan for the logistics. At SelfStorage.com, we make it easy to find affordable self-storage options that can help you transition between homes. Whether you’re downsizing temporarily, staging your current home for sale, or need a place to store furniture during the move, use our online tools to compare prices, find storage near you, and book instantly.