Zillow Advice: FHA and VA Loans - When can we qualify for a FHA loan? http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ Zillow Advice | Zillow Real Estate Here are the guidelines directly ... http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ Here are the guidelines directly from FHA. <p>A Chapter 7 bankruptcy (liquidation) does not disqualify a borrower from obtaining an FHA-insured mortgage, if at least two years have elapsed since the date of the discharge of the bankruptcy. During this time, the borrower must:</p><ul class="noindent"><li>-have reestablished good credit, or</li><li>-chosen not to incur new credit obligations.</li><li style="list-style: none">An elapsed period of less than two years, but not less than 12 months may be acceptable for an FHA-insured mortgage, if the borrower:</li><li>- can show that the bankruptcy was caused by extenuating circumstances beyond his/her control, and</li><li>- has since exhibited a documented ability to manage his/her financial affairs in a responsible manner.</li></ul><br/><br/><p><strong><em>Note:</em></strong> The lender must document that the borrower's current situation indicates that the events that led to the bankruptcy are not likely to recur.<br/><br/></p><p>A Chapter 13 bankruptcy does not disqualify a borrower from obtaining an FHA-insured mortgage, provided that the lender documents that:</p><ul><li>one year of the payout period under the bankruptcy has elapsed, and</li><li>the borrower's payment performance has been satisfactory and all required payments have been made on time.</li></ul><p>The borrower must receive written permission from the court to enter into the mortgage transaction.</p><p><strong><em>TOTAL Scorecard Accept Recommendation</em></strong></p><p>Lender documentation must show two years from the discharge date of a Chapter 13 bankruptcy.</p><p>If the Chapter 13 bankruptcy has not been discharged for a minimum period of 2 years, the loan must be downgraded to a Refer and be evaluated by a Direct Endorsement (DE) underwriter.<br/><br/></p> Sat, 18 Sep 2010 13:47:00 GMT http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ 2010-09-18T13:47:00Z As you can see the answers ... http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ As you can see the answers are all going to be about the same in terms of the hard and fast HUD rules. In my experience I&nbsp;recommend&nbsp;taking the next 2 - 4 years getting your&nbsp;financial&nbsp;house in order. Think about it like this;<br/><br/>Your family has been through a huge financial setback that has likely been lingering for a while and the bankruptcy was the really just the symptom of the greater issue. A lender is going to want to see that&nbsp;whatever&nbsp;the root cause of your declaration of bankruptcy is&nbsp;sufficiently&nbsp;in the past and the&nbsp;likelihood&nbsp;of it recurring is limited at best.<br/><br/><br/><br/>For example, you will need to have updated your credit bureaus to make sure that none of the items discharged from bankruptcy are still reporting a payment history, something most debtors are even unaware of. You will want to make sure that not so much as a bug stain&nbsp;appears&nbsp; in your credit report and you want to begin saving for a down payment now to make sure that not only that saving goal is achieved but that you still have sufficient money in reserves after the closing.<br/><br/><br/><br/> Mon, 20 Sep 2010 13:50:00 GMT http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ 2010-09-20T13:50:00Z On a Chapter 13 it is 2 years ... http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ On a Chapter 13 it is 2 years from the file date as an exception.&nbsp; 3 years without an exception.<br/>On a Chapter 7 it is 2 years from the discharge date. 3 years without an exception.<br/>The exception can only happened if you can explain and document what happened that caused the bankruptcy.&nbsp; If it was a one time event, that happened and is over and you have financially recovered from the underwriters will take a look at it.&nbsp; <br/>Also you must really prove that you are, at the time of application, recovered from your financial problems.&nbsp; They look at compensating factors such as stable great job that will continue with steady income, money saved, re-established 3 good&nbsp;tradelines with 2 yrs of on time payments and low balances, clean&nbsp;credit report,&nbsp;credit score, on time documented&nbsp;rental history payments etc... and in general that you are managing well now.&nbsp;&nbsp;&nbsp;<br/>Sincerely,<br/>Celia Sat, 18 Sep 2010 05:01:00 GMT http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ 2010-09-18T05:01:00Z Ch 7--2 years with 3.5% down ... http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ Ch 7--2 years with 3.5% down and 620 score unless a home was included ....then it's 3 yrs.&nbsp;&nbsp;<br/><br/>Ch. 13?? I can't recall at this time...<br/>&nbsp; Sat, 18 Sep 2010 03:05:00 GMT http://www.zillow.com/advice-thread/When-can-we-qualify-for-a-FHA-loan/366767/ 2010-09-18T03:05:00Z