Obtaining A Home Purchase Loan – After Foreclosure Or Bankruptcy

By
Mortgage and Lending with Strategic Mortgage NMLS#160440

It is certainly possible to obtain a home purchase loan, after a foreclosure, short sale or bankruptcy. However, in order to do so, it’s important to know that different home loan programs have different waiting periods to obtain a new home loan.

 

In addition, there are some general guidelines to follow, regardless of which type of new loan you are obtaining.

 

Re-establishment Of Credit – No matter what type of financing you try and obtain, it is important to re-establish credit, after a previous event like a foreclosure or bankruptcy. You will want to have a credit report that is generally free of additional derogatory credit since the previous event and you will want to have re-opened some new accounts that are in good standing.

 

Now, let’s take a look at the different loan types and their individual waiting periods.

 

FHA Loans – On an FHA loan there is standard three year waiting period after the finalization of a foreclosure or short sale to purchase a home or refinance an existing home loan into a new FHA loan.

 

When it comes to a bankruptcy, the waiting period is two years from the discharge of a chapter 7 or 11 bankruptcy.

 

In addition, if you had a foreclosure or short sale on another property, you do not have to wait three years to refinance an existing FHA loan into a new FHA loan, through an FHA streamline refinance.

 

VA Loans - On a VA (Veterans Administration) home loan, the standard waiting period is two years after a foreclosure or short sale to purchase a new home.

 

When it comes to a bankruptcy, the waiting period is two years from the discharge of a chapter 7 or 11 bankruptcy.

 

As with FHA home loans, if you had a foreclosure or short sale on another property and have an existing VA loan, there is no waiting period to refinance your existing VA loan through a VA streamline refinance.

 

Conventional Loans – On a conventional home loan, the waiting period is seven years after a foreclosure to obtain a new conventional loan for the purchase or refinance of a home. While the waiting period is four years after a short sale to obtain a new conventional loan.

 

When it comes to a bankruptcy, the waiting period is four years from the discharge of a chapter 7 or 11 bankruptcy.

 

However, if you have a conventional home loan that is “HARP” eligible (taking out prior to June 2009 and Fannie Mae or Freddie Mac owned), then there is no waiting period after a foreclosure to refinance into a new conventional home loan.

 

These are basic guidelines to purchase or refinance a home loan, after a foreclosure, short sale or bankruptcy. However, as always, it makes sense to speak with a licensed lender, such as Strategic Mortgage, to fully qualify and explore all available options for your specific situation.

 

For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos of Strategic Mortgage at (480) 219-3682 or by emailing: bill@strategicmtgaz.com or online at www.strategicmtgaz.com

Strategic Mortgage, LLC - AZ BK#0909514 - NMLS#158804 - Equal Housing Lender – Vasilios Bill Kamboukos Jr – NMLS#160440

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bankruptcy
home purchase
foreclosure
short sale

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Rainmaker
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Kristin Johnston - REALTOR®
RE/MAX Realty Center - Waukesha, WI
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Thanks for sharing this information!  Have a wonderful week ahead!

Apr 09, 2018 07:14 AM #1
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Rainmaker
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