Chapter 7 bankruptcies require 2 years seasoning; if bankruptcy is discharged for at least one Year (but not less than 12 months), it may be acceptable if it occurred due to extenuating circumstances beyond the borrower's control. Re-established credit must have no derogatory
Ratings; in lieu of re-established credit, credit letters covering the past 12 months from two Alternative credit sources (i.e. telephone, cable, gas or electric companies) are required.
· A borrower paying off debts under a Chapter 13 bankruptcy may be eligible if the bankruptcy Payments are included in the ratios, one year of the pay-out period has elapsed, the payment Plan has a satisfactory rating and the borrower receives court approval to enter into the Mortgage transaction.
· Foreclosures require 3 years seasoning
· Collections will be reviewed on a case-by-case basis depending on the overall loan quality.
Collection accounts do not need to be paid off at closing, but do need to be explained by the Borrower with a strong explanation letter regarding the circumstances and evidence the problem has been remedied. Medical collections are more lenient, but still reviewed in context of the entire credit picture.
·Consumer Credit Counseling is viewed the same as a Chapter 13 bankruptcy
Steve Eveleth "work for it" Cell 925.487.2246
http://www.steveshomesearch.com/
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