Mortgage Loans

[Llhg71]

My husband and I are going to be applying for a mortgage within the next 4 months.  What do you think our chances of being approved are?

$50k per year

DTI is 12% (contains car payment and 1 credit card)

Fico is  720

credit report has 2 negative marks:  bankruptcy from 2005 (spouse lost job.  So we filed on everything including an FHA mortgage)  and $40 medical bill that went to collection ( paid once we realized it was there)

We have not made any late payments at all. 

[JM-AM]

You have a good chance for approval. Let your LO or Broker guide you to the program that would work best for you.

[MovingForward_2012]

+1, you have an excellent chance for approval. I know you said you had a BK from 2005. Was it a Ch 7 or 13? A Ch 7 is usually discharged within 3 months of the filing date. A Ch 13 is discharged after finishing the 3 or 5 yr plan. With either bankruptcy, I think your odds are good. I recommend contacting a mortgage broker for preapproval if you are ready to buy.

Did the FHA loan included in bankruptcy go into foreclosure? If yes, what was the foreclosure sale date?

[Llhg71]

It was CH 7 and the house did go into foreclosure.  Sheriff sale was held May 2007.  Is that the date you are asking for?

[tooleman694]

You will have the banks begging for your business.

[JM-AM]

Yes and no tooleman. Since was defaulted on a government insured loan it isnt as easy for approval. But it is doable.

[Llhg71]

I did notice that the foreclosure is no longer on my credit report.  

This whole process is going to make me a nervous wreck before it's over with.  

[tooleman694]

I thought as long as you wait it out you were ok.

If this another one of those underwriter calls, where you fit the mold but they still say no.

[MovingForward_2012]

I think your fine since the foreclosure sale was over 5 years ago...that is usually the max waiting period required before you can get another mortgage loan. You are also more than 2 years from your BK discharge date so I think you will be fine.

[JM-AM]

Defaulted government insured loans even though they are off credit reports they are still in their database.

Its kind of like being blacklisted for a credit card when defaulted with certain companies.