09-27-2012 12:24 PM
I'm a mortgage officer, but I haven't worked a problem loan in a long time. Guidelines are constantly changing with everything that has transpired over the last five years. My understanding is that you can get a mortgage loan one day out of a Chapter 13 discharge if you qualify with credit scores, debt to income ratio, income and assets. It is having a foreclosure that prevents you from getting a mortgage loan for four years. I understand that you may be able to bypass the foreclosure four year mark by putting down a sizeable down payment, 35% or greater, AND in conjunction with using a local bank or credit union and not an FHA, Fannie Mae or Freddie Mac conventional loan. The difference is that the local bank or credit union uses their own investor money as opposed to selling off to the secondary market. Usually these loans are ARM's with a balloon in 5 or 10 years and an upfront commission (points). It will still have a 20 or 30 amortization to keep you payments down. The lender will want you to refinance when the balloon comes due. I imagine things will get looser on the FHA and conventional side as the government tries to grow the economy by driving home purchases. This area of the economy has been slow to recover. Remember, there are a lot of fiscally responsible people that lost their homes, not just deadbeats. This is a real viable growth area for the government to get these people back into homes and not renting.