Mortgage & Chapter 13 Question

[ProudMomof5]

I filed a chapter 13 this year and I heard that after you file you can obtain a mortgage in a year.  I know I have to work on getting my credit scores up but I have a question regarding lines of credit and payment history.  What are some alternative lines of credit banks will accept if going FHA besides credit cards?  Also, do they look at on time payments to your chapter 13 as a positive and use that as an on-time payment history or not?

[Anonymous]

When we filed our ch 13, I was told I could not obtain any new debit during the ch 13, without permission from the court. I know there are some lenders that will do home loans & auto loans during a ch13, but you will need to contact your lawyer. I think it is on a "MUST NEED" basis, and you have to REALLY be able to afford it.

I kinda broke the rules and got a low limit credit card, to help build my credit during the 5 year period, which I payed on perfectly. I waited untill after I got my discharge papers before I tried any other loans.. 

Also, that is one of the crappy things about a ch 13, anything included in it(which is pretty much everything, including mortgages!!!) is not going to be reported until you get discharged. Kinda the reason I got the card, because I had nothing postive on my credit during those 5 years.. And honestly, it helped, I had a 640 EQ credit score when I got my papers in and went and bought a truck the next week!

[ProudMomof5]

I know I have to ask my trustee before I purchase anything.  I guess what I'm asking is will they look at my year of on-time payments to my Chapter 13 when considering me for a mortgage if I go FHA. 

[Anonymous]

Nope, if you look at your credit report while or during BK, all of the accounts will say "included in CH13" and there will not be any reporting for them.

[ShanetheMortgageMan]

ProudMama, it'd have to be traditional credit such as credit cards, store cards, installment loans (car/student/personal) and items like that.  Anything that you didn't include in the Ch 13 BK and you have kept open could count too.  Non-traditional credit such as utilities, cell phone, etc. would not count towards re-established credit.  The payments to the trustee do not count either.