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Any Incite on VA Loan During Chapter 13?

nrbuck08
Member

Any Incite on VA Loan During Chapter 13?

Hi there! My husband and I filed for chapter 13 a year ago, we found out that the VA will work with people during chapter 13 as long as they have made 12 on-time monthly payments to the Trustee. 

 

Has anyone here had success obtaining a VA loan during chapter 13? I understand that any new credit must be approved by the courts, I've talked to a lender and she seemed very optimistic but we probably won't hear back until mid-next week. 

 

I'm not exactly sure what our scores are since I've heard Credit Karma may not be accurate. 

Message 1 of 4
3 REPLIES 3
jmw1
Contributor

Re: Any Incite on VA Loan During Chapter 13?


@nrbuck08 wrote:

Hi there! My husband and I filed for chapter 13 a year ago, we found out that the VA will work with people during chapter 13 as long as they have made 12 on-time monthly payments to the Trustee. 

 

Has anyone here had success obtaining a VA loan during chapter 13? I understand that any new credit must be approved by the courts, I've talked to a lender and she seemed very optimistic but we probably won't hear back until mid-next week. 

 

I'm not exactly sure what our scores are since I've heard Credit Karma may not be accurate. 


Is this for a purchase or a refinance?

 

How are you coming up with the money needed for cash to close? Does the money belong to the bankruptcy estate or is it somehow being exempted from the estate by your lawyer? Or is the money a gift or seller's concession? If the money is not exempt, the trustee will want to seize it from you for the benefit of the unsecured creditors.

 

You need your actual FICO mortgage scores. Myfico provides them at a cost. The other FICO scores are no good and of course Credit Karma won't work. There are cheaper ways to do it, but I'm lazy and wanted everything on one screen so I just went with myfico. I signed up for their cheapest 3-bureau report and cancelled it immediately. You can cancel online immediately after seeing the scores and retain access to the scores until 30 days have passed. If you need to fix your mortgage scores, I highly recommend you talk to your loan officer before you take any action. Sometimes what you think is good to do like pay down a card to $0 could actually be bad.

Message 2 of 4
Horseshoez
Established Contributor

Re: Any Incite on VA Loan During Chapter 13?


@jmw1 wrote:

@nrbuck08 wrote:

Hi there! My husband and I filed for chapter 13 a year ago, we found out that the VA will work with people during chapter 13 as long as they have made 12 on-time monthly payments to the Trustee. 

 

Has anyone here had success obtaining a VA loan during chapter 13? I understand that any new credit must be approved by the courts, I've talked to a lender and she seemed very optimistic but we probably won't hear back until mid-next week. 

 

I'm not exactly sure what our scores are since I've heard Credit Karma may not be accurate. 


How are you coming up with the money needed for cash to close? Does the money belong to the bankruptcy estate or is it somehow being exempted from the estate by your lawyer? Or is the money a gift or seller's concession? If the money is not exempt, the trustee will want to seize it from you for the benefit of the unsecured creditors.

 


I'm curious why you would say something like that.  During my Chapter 13 there was by definition, slack space for saving for a unexpected expenses, good thing too, I needed to buy a new(er) car during my fourth year and I had to pay cash for it.  Think about it this way, many jurisdictions allow you to keep your full tax return, others, like mine, allow you to keep the first $1,250 of a tax return; then there is the notion of increases in pay, most Trustees don't flinch unless the year-over-year increase is 10% or greater.  During my Chapter 13 I was able to keep all of my tax returns save one where I kept $1,250, and I kept all of my salary increases which totalled 36% over the 5 years.

I categorically refuse to do AZEO!

Message 3 of 4
nrbuck08
Member

Re: Any Incite on VA Loan During Chapter 13?

This will be our first home loan, my husband is rated at 40% disabled through VA so we won't have the VA funding fee. We were able to retain our tax refund and were able to save this last stimulus payment. I've already talked to my attorney and she let me know what will be needed to file with the courts.

 

I was just curious what people's experience has been being in chapter 13 and getting a loan through the VA.

Message 4 of 4
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