Posted on: 21st Feb, 2013 12:55am
Each month numerous homeowners file for bankruptcy protection. Most homeowners file bankruptcy to wipe out debts and start fresh financial life. The blots of bankruptcy remain on your credit report for 7 to 10 years. So you may be under the impression that you may not obtain a mortgage after bankruptcy up to a certain number of years.
In reality, however, you may not have to wait for that many years. The waiting period to obtain a home loan after bankruptcy vary upon the type of loan you are planning to take out, the type of bankruptcy that you have already filed and of course your credit standing at that time. However, if you work diligently and can improve your score substantially, then you may get approved for the mortgage loan much earlier. Have a look at this table to get to know about the waiting periods so as to get approved for different types of mortgage loans after bankruptcy.
But even after the stipulated waiting period is over, you still may not qualify for a loan. You have to fulfill the standard mortgage qualification criteria too. In a nutshell, you have to convince your lender that you're creditworthy and you should possess adequate and reliable source of income.
In reality, however, you may not have to wait for that many years. The waiting period to obtain a home loan after bankruptcy vary upon the type of loan you are planning to take out, the type of bankruptcy that you have already filed and of course your credit standing at that time. However, if you work diligently and can improve your score substantially, then you may get approved for the mortgage loan much earlier. Have a look at this table to get to know about the waiting periods so as to get approved for different types of mortgage loans after bankruptcy.
| FHA loan | 2 years since Chapter 7 discharge | 12 months of satisfactory Chapter 13 plan payments, with court approval |
| VA loan | 2 years since Chapter 7 discharge | 12 months of satisfactory Chapter 13 plan payments, with court approval |
| USDA loan | 3 years since Chapter 7 discharge | 12 months of satisfactory Chapter 13 plan payments, with court approval |
| Conventional loan | 4 years since Chapter 7 discharge | 2 years since Chapter 13 discharge |
But even after the stipulated waiting period is over, you still may not qualify for a loan. You have to fulfill the standard mortgage qualification criteria too. In a nutshell, you have to convince your lender that you're creditworthy and you should possess adequate and reliable source of income.
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2 years have passed since i filed chapter 7 bankruptcy and in march it will be 3yrs since our foreclosure. we were fortunate enough to own our current home free and clear, as well as our 2 vehicles, so we didn’t bother to open any new credit or rent. the only credit we have would be our gas/electric, sprint cell phone, and our cable internet. we are now looking to move into a better neighborhood which would require a mortgage (fha). i was under the impression that if we voluntarily chose to not open any new credit, that would be ok. now im not sure. i pulled my credit scores and middle score is 667. did i created problems for myself by not opening up new credit, or do you think all things considered, i'll be ok?
Hi Casey,
It would have been better if you would have opened some secured credit cards and improved your scores further. Nevertheless, with the credit score of 667, you might be able to qualify for a FHA loan. You should get in touch with the local FHA lenders and apply for a mortgage.
It would have been better if you would have opened some secured credit cards and improved your scores further. Nevertheless, with the credit score of 667, you might be able to qualify for a FHA loan. You should get in touch with the local FHA lenders and apply for a mortgage.
Since almost 3 years have been passed since you filed bankruptcy, you have high chance of getting approved for a loan. Your credit score is also fine to get approved for an FHA loan.