Articles Tagged With: Chapter 13 Bankruptcy

January 22, 2015

FHA Loans Following Chapter 13 Bankruptcy: A Reader Question

A reader asks, “i filed ch 13 in 2012 and my case has been discharged as of Dec 2014. do i have to wait 2 years from that discharge date or the filing date to qualify for FHA?” FHA loan rules for applying for a new home loan in the wake of a bankruptcy state that there is a minimum seasoning period or waiting period required after the discharge of the bankruptcy. For Chapter 13 bankruptcy, the FHA official site (www.fha.gov) has a Frequently Asked Questions page about applying for a new FHA loan post-bankruptcy, which states the following: “A Chapter 13 bankruptcy does not disqualify a borrower from obtaining an FHA mortgage provided the lender documents that one year of the payout period under the bankruptcy has elapsed and | more...

What you should know about FHA 203(h) Loans For Disaster Victims

January 14, 2015

FHA Loan Rules For New Loans Following A Bankruptcy: A Reader Question

By Joe Wallace

A reader asks, “My husband went bankrupt and it was discharged on may 7,2013 since then we have been bringing his credit up to 620 and my score is around 770 my question is on what month or day can we apply for a FHA loan and is our score good enough?” Unfortunately the answers to these questions depend greatly on a number of factors including lender standards. The waiting period following a bankruptcy–how long the borrower must wait before being allowed to apply for a new mortgage–depends on the type of bankruptcy and lender standards. FHA loan rules do provide a minimum waiting time depending on the type of bankruptcy, but these wait times are also dependent on circumstances. For example, here are the FHA loan rules for Chapter | more...

November 13, 2013

FHA Loans and Bankruptcy Requirements: A Reader Question

By Joe Wallace

A reader asks, “My bankruptcy was discharged December 7 2011. Prior to filing I had very good credit, but was forced to retire because of cutbacks. I currently have a Fannie Mae insured mortgage through a local bank and want to go to a small house and sell my current one. Since filing discharge my wife and I have a good credit record. When I called the bank they now tell me FHA requirement is 3 years. Previously I was told 2 years. Who is right and what can I send the bank to show them the answer.” FHA standards say different things depending on the type of bankruptcy and the circumstances surrounding it, but in any case borrowers should know that lender requirements may exceed the FHA minimums–the bank | more...

August 12, 2013

FHA Loan Questions: Applying For a Loan Following a Chapter 13 Bankruptcy

By Joe Wallace

A reader asks, “I was just released from Chapter 13 Bankruptcy and I would like to buy a house. What do I have to do to achieve this? My credit score is 635, 635 and 643.” FHA loan rules printed in HUD 4155.1 state that simply having a Chapter 13 bankruptcy does not disqualify you from getting an FHA loan, but there are certain standards a borrower needs to meet which must also be documented by the lender. Specifically, HUD 4155.1 Chapter Four Section C states, Chapter 13 bankruptcy”does not disqualify a borrower from obtaining an FHA-insured mortgage provided that the lender documents that: • one year of the pay-out period under the bankruptcy has elapsed • the borrower’s payment performance has been satisfactory and all required payments have been | more...

January 18, 2012

FHA Loan Reader Question: FHA Loans After Bankruptcy

By Joe Wallace

A reader asks a question about FHA loans and bankruptcy; “It will be two years since my bankruptcy discharged. I want to get a home and I am reading that the FHA will turn you down for post-bankruptcy late payments. Is this true?” According to the FHA official site at FHA.gov, the general rules for FHA loans post-bankruptcy include the following: “The FHA is generally more flexible than conventional lenders in its qualifying guidelines. In fact, the FHA allows you to re-establish credit if: – two years have passed since a bankruptcy has been discharged – all judgments have been paid – any outstanding tax liens have been satisfied or appropriate arrangements have been made to establish a repayment plan with the IRS or state Department of Revenue – three | more...

May 10, 2011

How Does Chapter 13 Bankruptcy Affect My FHA Loan Application?

By Joe Wallace

In our last blog post we explored the FHA rules governing Chapter 7 bankruptcy and FHA mortgage loan applications. Having a Chapter 7 bankruptcy on your credit record does not automatically disqualify you from an FHA mortgage, but what about those who have Chapter 13 bankruptcy proceedings on their credit history? There are many similarities in the FHA rules for Chapter 13 bankruptcy and Chapter 7. The first is that having a Chapter 13 does not automatically mean a borrower will be rejected for the new FHA mortgage loan. Like Chapter 7 rules, the FHA requirements for Chapter 13, a record of on-time payments and improved credit habits is required. But unlike the FHA rules for Chapter 7, borrowers who filed Chapter 13 bankruptcy in the past have additional rules | more...