Unfortunately, many people have struggled due to economical conditions that were out of their control and forced into bankruptcy. The good news is that in as little as 2 years from the discharge date (not the date you filed bankruptcy) of your chapter 7 bankruptcy, you can apply for a FHA home loan and you only have to wait just one year after a chapter 13. However, with a chapter 13, you still have to qualify with your debt payments included in with your debt to income ratio as well as getting permission from the courts.
Was a mortgage included in with your bankruptcy?
FHA loan requirements require that if a mortgage was included in your bankruptcy, you have to wait 3 years from the official date of foreclosure. Now many people get confused with this, but you have to remember that it’s the date that the title of the property was transferred out of your name, not the date of bankruptcy discharge.
Use your credit responsibly post-bankruptcy
It is extremely important that you are able to show the lender that you have learned from your past mistakes and you are now more responsible about paying all of your debts and on time. Any delinquencies post-bankruptcy will disqualify you from being able to get approved for a FHA insured home loan.
Your credit score will also play a very important roll on whether you get approved, or not. Even with having a bankruptcy recorded on your credit report, you can still obtain a good credit score. Although your interest rate at first will be higher than most, you’re going to have to re-establish your credit. This means that you’re going to need to open new credit lines to show that you are now a more responsible borrower. Get a new car loan or credit card. Capital One is a great lender that works well with people who have filed bankruptcy.