If a bankruptcy has been filed in the past there are a few guidelines to follow when determining if when a buyer can purchase a home.
Chapter 7 Bankruptcy
FHA mortgage guidelines require that a buyer must wait 2 full years from the bankruptcy discharge before they can become eligible to purchase a home. They must meet all FHA guidelines and be able to provide evidence that they can manage their financial affairs responsibly. Chapter 7 Bankruptcy that was discharged within 12 months to 2 years is only eligible for an FHA mortgage approval if there were extenuating circumstance that was beyond the buyer's ability to control and they can provide proof that they can manage their finances in a responsible manner.
Chapter 13 Bankruptcy
A buyer can apply for an FHA mortgage after filing a Chapter 13 Bankruptcy. All payments must have been made in a timely fashion for 12 months and the buyer must receive permission from the courts to purchase a home.
FHA mortgages also feature easy approval criteria and allow credit scores as low as a 580 as long as there have been no late payments in the last 12 months. (1 late payment is allowed with a good letter of explanation) Home buyers must have 3.5% down payment which can be a gift from family, employer or close friends and 2 years work or educational experience in the same field.
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