Qualifying for a home mortgage with a bankruptcy on your credit history requires time and money. Yet by understanding the requirements to get a mortgage after a chapter 13 or 7 bankruptcy and by carefully rebuilding your credit standing, you can apply and qualify for a loan and buy a home right after bankruptcy.
Before You Apply For A Mortgage- No matter what route you pursue to get an FHA or VA mortgage with a bankruptcy filing in your past, you should begin immediately after the filing to repair your payment history and credit score. Remember in order to get your score up you need to positive reporting trade lines. And, the most negative information falls off your report after (3) three years, so your score and establish payment histroy via 12 months rental checks and credit cards are best. Purchase a secured credit card immediately and as a rule of thumb never go over 10% of the credit card limit.
Increase Your Credit Score- The three main U.S. credit bureaus–Equifax, Experian and TransUnion–maintain your credit history. Using that history, plus its own proprietary equation, the Fair Isaac Corp. calculates your FICO credit score somewhere between 850 and 300 points. Anything above 700 points is good to excellent, with 720 or above earning you lower interest rates. Below 620 points is considered poor.
Bankruptcy On Your Credit-A bankruptcy makes a major impact on your credit score and makes it much more difficult to qualify for a home mortgage. First, you can expect a drop of 100 or more points. That immediately takes you from excellent to poor. Then a record of the bankruptcy stays on your credit history for 10 years. A foreclosure stays on for seven years. Other negative information such as a late payment stays on for three years.
While obtaining a home mortgage with a bankruptcy on your record is difficult, you don’t have to wait 10 years to begin making a difference.
BANKRUPTCY – FORECLOSURE – SHORT SALE
Mortgage 1 day after bankruptcy or Foreclosure
PORTFOLIO- PRIVATE MORTGAGE LENDER APPROVALS!
- Purchase 1 day after bankruptcy, foreclosure, short sale and deed in lieu of foreclosure up to 2.5 million. These are not subprime loans, but they do often have higher interest rates and higher closing costs.
- Portfolio mortgage lender offer private mortgage loan approvals are looking at other compensating factors to approve these loans. Examples include 12 months timely rental history, high credit scores, lower loan to value (larger down payments), and reserves (future mortgage payments in the account at closing).
A minimum 500 credit score For Portfolio Mortgage Lenders Programs!!
BAD CREDIT FHA MORTGAGE LENDERS APPROVALS WITH MINIMAL DOWN PAYMENT AND CLOSING FEES:
- Down payment only 3.5% of the purchase price.
- Gifts from family or FHA Grants for down payment assistance and closing costs OK!
- Sellers can credit the buyer’s up to 6% of sales price towards buyers costs and pre-paid.
- No reserves or future payments in account required.
- FHA regulated closing costs.
- Read more about buying a home with an FHA mortgage Bad Credit –No Credit – Investment –Second Home –Multi Family –
BAD CREDIT FHA MORTGAGE LENDERS MAKE QUALIFYING EASIER BECAUSE YOU CAN PURCHASE:
- 12 months after a chapter 13 Bankruptcy FHA mortgage Lender approvals!
- 24 months after a chapter 7 Bankruptcy FHA mortgage Lender approvals!
- 3 years after a Foreclosure FHA mortgage Lender approvals!
- No Credit Score FHA mortgage Lender approvals!
- 580 required for 96.5% financing or 3.5% down payment FHA mortgage Lender approvals.
- 500 required for 90% financing or 10% down payment FHA mortgage Lender approvals.
- Bad Credit with minimum 500 FICO credit score with 10% Down Payment FHA. For FHA mortgage applicants with credit scores between 500 and 579 must make down payments of at least 10% down!
- Read more about FHA Qualifying Qualification Summary – Manual Underwrite – Collections-Judgement’s – Bankruptcy or Foreclosure – Compensating Factors –
BAD CREDIT FHA MORTGAGE LENDERS ALLOW HIGHER DEBT TO INCOME & EASIER JOB QUALIFYING
- FHA allows higher debt ratio’s than any conventional mortgage loan programs.
- Less than two years on the same job is OK!
- Self-employed buyers can also qualify with FHA Mortgage Lenders.
- Read More about Gifts For Down Payment – Documents Checklist – Debt To Income – Student Loans –
SAME DAY PRE APPROVALS!
- Chapter 13 Bankruptcy- You may apply for a FHA mortgage after your bankruptcy has been discharged for 12 Months or (1) year with a Chapter 13 Bankruptcy. You must have 0 x 30 day late payments, and permission from the chapter 13 trustee.
- Chapter 7 Bankruptcy- You may apply for a FHA mortgage after your bankruptcy has been discharged for TWO (2) years with a Chapter 7 Bankruptcy. You may apply for a FHA insured loan after your bankruptcy has been discharged for ONE (1) year with a Chapter 13 Bankruptcy
- Foreclosure – You may apply for a FHA insured loan THREE (3) years after the Foreclosure sale/deed transfer date. You may have to search county records office to locate the deed in order to count a full 3 years.
- Short Sale / Deed in Lieu – You may apply for a FHA insured loan THREE (3) years after the sale date of your foreclosure. FHA treats a short sale the same as a Foreclosure for now.You may have to search county records office to locate the deed in order to count a full 3 years.
- Credit must be re-established no late payments in past 12-24 months, depending on hardship
- Application Date must be after the above waiting period to be eligible for FHA financing after hardship.You may have to search county records office to locate the deed transfer out of your name fin order to count a full 3 years.
- Chapter 13 Bankruptcy – Once you have finished making all payments satisfactorily, the mortgage lender may conclude that you have reestablished satisfactory credit.
- If you have made at least 12 months of timely payments and the Trustee or the Bankruptcy Judge approves of the new home purchase, the mortgage lender will approve financing after a chapter 13 bankruptcy.
- Chapter 7 Bankruptcy – You may apply for a VA mortgage loan TWO (2) years after a chapter 7 Bankruptcy.
- Foreclosure / Deed in Lieu – You may apply for a VA mortgage loan TWO (2) years after a foreclosure.
- Short Sale – VA does not recognize a short sale as a derogatory event, however, most mortgage lenders do. Most lenders will require a full 2 years after the deed was transferred out of your name and you re-establish credit.
- Credit must be re-established with a minimum 550 credit score
- Application Date must be after the above waiting period to be eligible for VA mortgage after hardship.
VA Mortgage Lenders Require A minimum 550 credit score.
USDA- MORTGAGE APPROVALS!
- Foreclosure – You may apply for a USDA rural loan THREE (3) years after a Foreclosure.
- Bankruptcy – You may apply for a USDA rural loan THREE (3) years after the discharge of Chapter 7 or 13 Bankruptcy.
- Short Sale / Deed in Lieu of Foreclosure – mortgage lenders require 3 years after a foreclosure.
USDA Lenders Require A minimum 550 credit score.
CONVENTIONAL– MORTGAGE APPROVALS!
- Foreclosure – You may apply for a Conventional mortgage, Fannie Mae loan (7) SEVEN years after the sale date of your foreclosure.
- Bankruptcy – You may apply for a Conventional, Fannie Mae loan after your Chapter 7 bankruptcy has been discharged for FOUR (4) years, TWO (2) years from the discharge of a Chapter 13
- Short Sale / Deed in Lieu of Foreclosure –Waiting period for foreclosure that was included in Bankruptcy If mortgage is included in Bankruptcy, waiting period defaults to FOUR (4) from the discharge date. Short Sale or Deed in Lieu of Foreclosure not included in a Bankruptcy has a new Waiting Period of FOUR (4) years from date your name is removed from title. This replaces the ability to buy in 24 months with 20% down payment and minimum 680 credit score.
Conventional Lenders Require A minimum 620 credit score.
BAD CREDIT MORTGAGE LENDERS PROGRAMS INCLUDE:
- Bank Statement Only Bad Credit Mortgage Lenders
- FHA Bad Credit Mortgage Lenders
- VA Bad Credit Mortgage Lenders
- USDA Bad Credit Mortgage Lenders
- Jumbo Bad Credit Mortgage Lenders
- Hard Money Bad Credit Hard Money Lenders
- No Credit Score – Previous Bad Credit Mortgage Lenders
- Condominium Bad Credit Mortgage Lenders
- Town House Bad Credit Mortgage Lenders
- Modular Home Bad Credit Mortgage Lenders
- Chapter 13 FHA Mortgage Lenders
- Non-Warrant-able Condo Bad Credit Mortgage Lenders