Recently Fannie Mae has come out with guidance that makes the waiting period for people who agree to a deed-in-lieu of foreclosure from four years to two years before they can get a mortgage from Fannie Mae. Want more articles like this? Create an account today to get BiggerPocket's best blog articles delivered to your inbox Sign up for free Fannie Mae is trying to encourage people to agree to deeds in lieu of foreclosure — not to give those they actually have to foreclose on a break. The announcement also clarifies that Fannie Mae considers the terms “short sale” and a “preforeclosure sale” to be synonymous. The existing policy has been that you could be eligible for a loan again within two years after a preforeclosure sale. There was no official policy for a “short sale.” Now, they are saying the two years applies to short sales, too. NO CHANGE. If you cannot pull off a short sale or agree to a deed-in-lieu, Fannie Mae will still require FIVE YEARS for borrowers who lose their homes through foreclosure to re-establish credit. Borrowers may qualify in as soon as three years if they can document extenuating circumstances, such as the loss of a job, illness or divorce. The minimum wait for borrowers who have filed for bankruptcy remains two to four years, depending on the type of bankruptcy filing and the borrower’s success in repaying their creditors. You can learn more about this announcement by seeing the Fannie Mae announcement here.