February 6, 2015
A reader contacted us with a lengthy question about FHA home loans following a foreclosure. Here’s the question:
“Are there any new rules as it relates to months required with a foreclosure expected in 2015? I had the same situation in which in my bankruptcy was my current house we had purchased after going through a divorce and loosing my employment.
On my credit report it clearly shows that the loan to that property was part of the bankruptcy and was discharged Sept 13,2010.
I am trying to refinance with my current husband under an FHA Loan and I have gone to multiple lenders and once all is reviewed they come back with the same response that since my deed to the property we included in the bankruptcy did not get changed out of our name and into the banks name until Feb 2013, 3 years later. We were denied financing because I had not reached the 36 months from the foreclosure, even though it was discharged in Sept 2010..
I as well am trying to understand this but how is it I am being denied because the bank did not do there part at the time of the bankruptcy discharged? Since I was discharge of the loan, I have no control over how long it takes them to finish the paperwork on their end.
Please advise what I can do at this point, we have our loan with a private loaner, and want to get the house refinanced by a bank or mortgage lender. Thank you.”
This long question has a fairly short answer–it’s clear that the reader went to multiple lenders and got the same answer–not enough time has elapsed since the foreclosure and bankruptcy for this borrower to successfully apply for a new home loan.
The lender doesn’t look at the reasons why enough time hasn’t elapsed since the bankruptcy and foreclosure, only that technically speaking there simply haven’t been enough calendar days gone by yet for another lender to consider the loan. The only thing this borrower can do in terms of getting a new FHA home loan is to wait.
Where the other issue is concerned, borrowers who have issues with how the bankruptcy/foreclosure proceedings were handled may wish to speak to a lawyer to see what legal remedies might be available, but we can’t comment on what’s possible in that area.
Do you have questions about FHA home loans? Ask us in the comments section.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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