Mortgage Center

Melissa Cowperthwaite with Stearns

Bob Cooley with Guild Mortgage

Hi Cole Real Estate Team,

Many, many people are confused today as to the rules and regulations regarding when a person can buy a Home after having a bankruptcy, short sale or foreclosure. Part of the confusion is that the rules are different depending on what type of loan you are getting, what your down payment is and if your credit scores have recovered from the event. The simple answer is that if you have 2 years from a chapter 7 bankruptcy or three years from a short sale you may have a pretty good shot at getting a loan. Again it is VERY confusing and the best advice I can give you is to have your client’s call me and we can give a FREE analysis and pull their credit for FREE. Even if they are not able to move forward today, we can point them in the right direction and tell them what they need to do in order to buy as early as possible.

Here are some basics of what lender are looking for but remember, every borrower has a different situation and could possibly by sooner or possibly have to wait a bit longer….depending on circumstances, credit score, down payment, savings and many other factors. So again, please have them contact me and we can analyze their situation and help them to move quickly.

CONVENTIONAL FINANCING:


Chapter 7 bankruptcy: 4 years from discharge

Chapter 13 bankruptcy: 2 years from discharge or 4 years from dismissal

Foreclosure: 7 years from completion date

Short Sale: 4 years from date of short sale

FHA FINANCING:


Chapter 7 bankruptcy: 2 years from discharge

Chapter 13 bankruptcy: Can do while still in BK as long as 1 year of payments have been made on

time and with approval from the bankruptcy court

Foreclosure: 3 years from date of trustee’s deed executed

Short Sale: 3 years from date of short sale

VA FINANCING:


Chapter 7 bankruptcy: 2 years from discharge

Chapter 13 bankruptcy: Can do while still in BK as long as 1 year of payments have been made on

time and with approval from the bankruptcy court

Foreclosure: 2 years from completion date

Short Sale: Typically 2 years unless there are extenuation circumstances

Please remember that these are guidelines and that sometimes it is possible to get a borrower approved in a shorter time frame and sometimes a borrower may have to wait longer. Again, the best idea is to have them contact me and I will give them a complete analysis of their situation for FREE. Thanks and please let me know if you have any questions.