fha

[ahtera2002]

What is the name of your state?Mississippi
I filed bankruptcy in 2002 and was discharged in 2003. I have reestablished credit but I was late on a credit card one time (30 days) in january 2004. What are my chances of getting approved for an fha loan?

 

[HomeGuru]

What is the name of your state?Mississippi
I filed bankruptcy in 2002 and was discharged in 2003. I have reestablished credit but I was late on a credit card one time (30 days) in january 2004. What are my chances of getting approved for an fha loan?

**A: contact a mortgage broker.

 

[amortgageman]

Sorry, but FHA requires two years after bankruptcy has been discharged, and absolutlely no deragatory credit after the bankruptcy.

 

[porcelina68]

I don't think that's totally true. I went through a mortgage broker, and got an FHA loan, with a great interest rate, while still IN Chapter 13.

 

[amortgageman]

Porcelina,

Yes that is true that you can obtain an FHA loan while still in Chapter 13 (as long as there is a good pay history, with no late payments). The disqualification on the posters mortgage approval is the derogatory payment after discharge of the bankruptcy.

 

[rainmand]

For clarifications sake...

An FHA loan can be obtained while in a Chapter 13 if no deragatory credit has occurred (including Trustee payments) for 12 consecutive months. The 12 month period begins on the filing date.

An FHA loan can be obtained after a Chapter 7 has concluded if no deragatory credit has occurred for 24 consecutive months. The 24 month period begins on the discharge date.

Just as amortgageman said, there must be absolutlely no deragatory credit during the 12 or 24 month periods.

 

[shayne54]

I too am a loan officer and work for a company in Elkhart IN. I also thought that you must have 2 yrs since discharge of a chapter 7 to recieve FHA financing. This however is not allways true. Here is a quote from Brian Sacks the self proclaimed BK specialist.

"For an applicant who has had a Chapter 7 Bankruptcy (liquidation), the guidelines state that the amount of time that has passed since the bankruptcy was discharged is an important consideration. Two years is the usual acceptable amount of time that must have passed. However, if the applicant can show extenuating circumstances, then one year from the date of discharge might be acceptable.

Extenuating circumstances can include job loss, prolonged strike, non-covered medical bills, etc. The circumstances must be verified. Divorce is usually not considered to be beyond the control of the applicant; however, certain circumstances created by a divorce might be considered extenuating.

In either case, there must be no new derogatory information for at least one year.

If the bankruptcy has been discharged within the past 12 months, it usually will not be possible to determine creditworthiness."-Brian Sacks Broker Universe

 

[MortgageGuru]

Post BK derogatories can be waived as long as they are fully explained and the borrower can show solid evidence that it was a one time occurrance.

 

[rainmand]

By default, a borrower must wait 24 months and have perfect credit for 24 months to receive an FHA loan after their chapter 7 has been discharged. However, confirmation the event was isolated and won't happen again will enable a Chapter 7 borrower to purchase a home 12 months after the discharge if their credit is perfect during those 12 months. The same guidelines apply to borrower's with a Foreclosure. That's good news for folks with recent Foreclosures.

It's not easy though. A lot of extra effort is involved because the situation that resulted in the bankruptcy/foreclosure must be fully documented in order for the Underwriter to allow the loan to happen.