Too Soon?

[Wishkah]

Hi!  Been lurking awhile and finally needed to make my first post!

After working very hard at rebuilding our credit after our chapter 7 my wife and I are finally on the verge of buying our first home!  Our bankruptcy will be discharged exactly 2 years in June.  We are getting really excited as it grows closer and have been watching the market and saving houses to our favorites for motivation and tracking what they sell for and what not and just stumbled across the perfect house that meets everything on our want/need list.  I have a great realtor that I've known since grade school and he said he's ready to work for me as soon as I have a pre-approval letter.  I called one mortgage lender and haven't had them pull a tri-merge or anything just explained the situation and she recommend I don't even apply until June when it's reached the 2 year mark.  

We are quite certain that within the next 2 months or heck even 2 weeks this house will be gone.  It's listed as a fannie mae homepath home and I really want to go USDA or FHA 203k with it.

So... My question is...  What are my chances of applying now and getting pre-approved and then just closing after the discharge in June?  

I've been told with appraisals and inspections and everything it could take 30-60 days anyway but I'm betting since they are requesting offers be submitted through homepath they want it gone now without waiting for all of that?

Here's the guts of the deal:

MICHIGAN

Me:

My FICO(from this site): 667

Annual Income: 30k

7 years same employment

Auto-Loan with Carfinance.com: 15k no lates ever and been opened for over a year ($385/mo)

3 Unsecured Credit Cards (Credit One Bank $500/First Premier $700/Capital One $300): All with less than $20 Balance - No Lates been opened over a year

401k with about 5 grand in it

Wife:

FICO: 661

Annual Income: 25k

1 1/2 year same job

3 Credit Cards - 1 - 30 day late on one card because we forgot about it and all with less than $20 balance

30k in Student Loans but are in deferrment showing multiple lates but all are before the BK

Asking price of home $99,000

The one and only lender I spoke to said with our credit scores and income we should be fine but she wants to wait until June even with the compensating factors of 401k, no lates, etc...

Am I just being wishful and dreaming that we could apply now and start the process and maybe go FHA 203k and get an extra $10,000 for repairs and get everything going now that way we can close beginning of June or Sooner.  Location is perfect and is half way between both of our jobs.  I just don't want to lose this house because the LO wants to wait 2 more months for a sure thing in underwriting and a quicker pay check...  

Advice?  Suggestions?  Thanks so much in advance!

[ShanetheMortgageMan]

Application has to be made after the 2 year mark for FHA.  USDA requires 3 years on a Ch 7 BK discharge (less than 3 years can be OK if the BK was due to extenuating circumstances such as loss of job, delay or reduction in government benefits or other loss of income, increased expenses due to illness, death, etc.).  You can still get pre-approved before then, but the lender can't send you out the application with the property address until the waiting period is over.  So you can get pre-approved, make the offer & get it accepted, but you'll have to wait until the 2 year mark before the FHA case # is ordered, appraisal is done, etc.

[Wishkah]

Thanks Shane! Tomorrow morning I'll try to get a pre approval letter and offer submitted. I have been following the other extensive post about the "USDA after chapter 7" and there it said that a BK could be overlooked with a credit score above 640 but I'm assuming that's only for the direct program not the guaranteed. I've been learning a lot over the past year and I just hope our hard work and determination will soon pay off!

[ShanetheMortgageMan]

Yeah that is just with the direct program.  In order for a shorter than 3 year waiting period on the Guaranteed version the BK has to have been from an extenuating circumstance.