Questions about Getting a Loan After BK7

svtthis · ‎03-04-2014

Hello all,

I just talked to a loan officer today to see if I could get pre approved for a mortgage. He pulled my credit report and said that the date for my foreclosure wasn't listed on my report. I didn't think that mattered since I included the home in bankruptcy?

I have a discharge date of 3/2012 on my BK7 which is 2 years for FHA. But the loan officer told me its when the property was sold at auction is the time that I need to start counting 3 years from. Which that is 04/2016. Is he right? Am I going to have to wait another 2 years to buy a house?

StartingOver10 · ‎03-04-2014

For an FHA loan, the time period is 3 years from the date the deed transferred from you back to the bank in the case of a foreclosure or Deed in Lieu. The complete resolution of the old mortgage has to occur. A successful discharge in your BK only releases your personal liability to repay the loan. The bank still has to go through the process to obtain the collateral through f/c or DIL. The alternate is to do a short sale after the BK (or a traditional sale if you have the equity) and the closing date is the start date for your 3 yr time period.

If you have 20% to put down on the new purchase you can get a conventional loan if it has been 2 years from the date the deed transferred back to the bank.

If you can qualify for the Back to Work program from FHA then it is one year from the date the deed transferred back to the bank.

grassfeeder · ‎03-04-2014

What would happen if you stayed in the home and sold it given built equity. I assume no waiting period would apply then?

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StartingOver10 · ‎03-04-2014

@grassfeeder wrote:
What would happen if you stayed in the home and sold it given built equity. I assume no waiting period would apply then?

Correct. If you have equity and you sell it in a traditional sale after your BK then you get to keep the equity and as long as the 2 yrs from BK has transpired you can get a new loan. This is 2 yrs for a new FHA loan or 1 yr with extenuating circumstances. For a conventional loan it is 4 years or 2 yrs with extenuating circumstances. If you have a Ch 13 and not a Ch 7; then it is 2 yrs from discharge. There are times you can get financing in a Ch 13 with trustee approval only.

You have to prove that your payments were made on time during the 24 months from BK to the closing date. You would need to show your payments from your bank account or cancelled checks because they wouldn't show up on your CR. Naturally you would then also show your HUD1 to the u/w too.