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Profile picture for chateaubriant

How to find bankruptcy friendly mortgage lender?

My Chapter 13 bankruptcy has just been discharged. I have a high income (W2 verifiable). Looking to buy a $350K property and  I have ~ 20% to put down. 

Does anyone have any idea where to shop for a bankruptcy lender?

Thanks 
  • February 26 2014 - Tracy
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Answers (12)

Profile picture for carlg69 cg
Hi my name is Carl I live in omaha NE and me and my wife had filed bankruptcy chapter 7 and we only have 16,000 left to Pay on our house. But we want to relocate to iowa and sell this house and get another one where can I find a lender.
  • April 18
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Hi Chateaubriant

you would need 12 month seasoning before you can apply for FHA , VA or USDA loan.


Good Luck 


Omar Khamisa
  • March 03 2014
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FHA, USDA, or VA guidelines allow for mortgage after 12 months of payment performance. Visit with a reputable mortgage lender to get pre-approved and start shopping!
  • March 01 2014
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There are lenders like myself that can work with borrowers who've had a bankruptcy as long they rebuilt their credit and passed the minimum waiting period. When it comes to waiting periods you can obtain an FHA loan during a Chapter 13 bankruptcy as long as you have made 12 months of satisfactory Chapter 13 plan payments, but you must have bankruptcy court approval to get the loan. In the case of either an FHA loan or a VA loan, you must provide an explanation of the bankruptcy. Conventional loans have the longest waiting periods. If you want a conventional loan, you must wait four years after receiving a Chapter 13 discharge. If your Chapter 13 case was dismissed without a discharge, you must wait four years from the date of the dismissal. If you would really like a mortgage there are also hard money loan options that you can consider. Either way,  the best thing for you to do is to speak with a knowledgeable lender to see if you can get started on financing a new home. If you need additional assistance, feel free to reach out. Good luck!
  • February 27 2014
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Profile picture for Arizona Mortgage Pro
I echo what most everyone else has said. You should be able to qualify for FHA now if your Ch. 13 is already discharged and credit has recovered. FHA does come with a little higher costs than some other options, but it allows you to obtain a loan when most or all other programs will not (yet). 

Most any lender can provide you with this loan option, so you don't need to shop for a bankruptcy friendly lender, just a friendly lender :)
  • February 27 2014
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You should have options if you are fully discharged from a Chapter 13 as you can be eligible after just 12 months of payment history without a full discharge. Contact a Mortgage Professional directly so that you can discuss your individual situation in more detail and get pre-approved. All the best!!
  • February 27 2014
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@chateaubriand,

You would be eligible to all of the following documentation:

1.  Evidence that the borrower is at least 12 months into payment plan
2.  Evidence of payment amount and that all payments have been made on time
3.  Evidence of court permission to enter into mortgage

So no you do not need to wait one year after you have already paid for 12 months.  Have you re-established credit? 
  • February 27 2014
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Profile picture for Brookstone Mortgage
"I read one must wait 1 year after the chapter 13 discharge to qualify for FHA financing. I just got discharge and can't wait a year. "
---------
That is incorrect, it's not 1 year after "discharge." Here's the actual FHA guideline.

"A Chapter 13 bankruptcy does not disqualify a borrower from obtaining an FHA-insured mortgage, provided that the lender documents that 
 
• one year of the pay-out period under the bankruptcy has elapsed 
• the borrower's payment performance has been satisfactory and all required payments have been made on time, and 
• the borrower has received written permission from bankruptcy court to enter into the mortgage transaction."

Please contact me through my profile if you'd like assistance.

  • February 27 2014
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Profile picture for chateaubriant
Thank you everyone for your response.

I read one must wait 1 year after the chapter 13 discharge to qualify for FHA financing. I just got discharge and can't wait a year. 

 
  • February 27 2014
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Any reputable lender will be able to give you multiple loan product options and help you work through the specifics of your bankruptcy to see if you do in fact qualify.

I know several and would be happy to connect you.
  • February 26 2014
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Profile picture for Brookstone Mortgage
Ditto what Justin said. If you are OK with FHA then that's most likely your best option if you are dead set on buying now. You may want to consider putting down just the minimum 3.5% and investing the extra $57,750 elsewhere to help offset the extra MIP you will be paying. 
  • February 26 2014
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For your situation the most common program used would be FHA financing, the downside is you will have to lays expensive mortgage insurance even with 20% down. There are a few other options outside of FHA with "non prime" or "second chance" lenders however these tend to result in either much higher rates or adjustable rate loans.
  • February 26 2014
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