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Lvgal, Home Buyer in Portland, OR

I'm just getting discharged from a Chapter 7 bankruptcy and now I have a new job that will more than pay for a mortgage. I can afford to put

Asked by Lvgal, Portland, OR Fri Dec 25, 2009

about 10% down for a small condo and I'm wondering how long after bankruptcy will I need to wait to get a mortgage. If it's a year than I should have 20% to put down without a problem. How hard will it be for me to get a mortgage in 3-12 months? The only advantage to doing it sooner is I'm a 1st time homebuyer and would like to take advantage of the rebate if possible.

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7
Matthew Vaughan’s answer
FHA Lending guidelines will allow you to qualify for a purchase mortgage in as short as 2 years after bankruptcy.

The best approach to this is to meet with a quality lender and lay out the situation (If you've gone through Chapter 7 you've done that a few times - I hope your trustee wasn't a real #$&!!). A good lender can guide you to a gentle landing in this process and get you a good deal also. The key is good communication - with your lender; with your Broker; between your lender and broker.
Web Reference: http://www.mwvaughan.com
0 votes Thank Flag Link Mon Dec 28, 2009
Al's right with one exception maybe try having a family member purchase the home now while the market is in your favor, then when your year is up buy it from your family member. If it's a close family memeber I believe you can get a gift of equity with the purchase and may only need that gift or perhaps just a little as in 3 or 10% to buy it.
Doing this is saving you money if the market increases in the next year. If it doesn't then waiting won't hurt.
My guess is the market will go up some. And now is the time to buy.
Web Reference: http://www.urhomerealty.net
0 votes Thank Flag Link Sun Dec 27, 2009
Lvgal, it's true that your credit score is very important as Tom says, but Barbara is correct about the guidelines. You can't get a loan within a year of a chapter 7.

Save up your 20%, protect your credit and in two years you will hopefully be in a great position to purchase a home.

Good luck.
0 votes Thank Flag Link Sun Dec 27, 2009
Lvgal, your credit score is what is important. Check with my lenders that I use. Email me for a couple of names of great lenders that can answer your questions. Your best way might be to get a contract with an private party and develop good credit history. This way you could buy a with an accepted offer on a house by April 30, 2010 and close by June 30, 2010.
Tom Inglesby, Broker
RE/MAX Equity Group inc.
CRS, ABR, Earth Advantge Broker, CDPE
503-319-9035
0 votes Thank Flag Link Sun Dec 27, 2009
Lvgal,

The first step you'll need to take is to talk with a good mortgage broker. You ability to buy a home will be dependent upon your credit score. This has been affected by your Chapter 7. Since I'm not a lender/mortgage broker, you should really talk to someone at this time.

I know two which I will refer:
Willie R Williams Jr
Mortgage Consultant
Wells Fargo Home Mortgage
Corporate Connection
MAC P6032-011
14795 SW Murray Scholls Drive Suite 108
Beaverton, OR 97007
Toll Free 1 (877) 881-5531ext 1004
(503)590.3938 x 1004 Tel
(866)839-8072 E -Fax
Willie.R.WilliamsJr@wellsfargo.com

~~~~~~~~~~~~~~~~~~~~~~~~~~~

Nevin Williams
Branch Manager
First Priority Financial
(888) 206-5781 x 1017 Toll free
(916) 802-9743 Cell
(888) 206-5781 E Fax

Both "Williams" (no relation to each other) are VERY good, competent and knowledgable. I've worked with both, and they know their stuff. Please do yourself a favor, and contact them.

You will hear what you need to do in order to plan for a home purchase.

Regards,

Carla Muss-Jacobs, Principal Broker/Owner
EBA Portland, LLC
Exclusive Buyers' Agent
Assisting Buyers in Metro Portland since 1999
http://www.EBAPortland.com
0 votes Thank Flag Link Sat Dec 26, 2009
Hi Lvgal ~

Here are the guidelines regarding "Chapter 7" bankruptcy for FHA or Conventional financing. Keep in mind that credit guidelines continue to change so the information is based on today's rules:

FHA FINANCING
HUD requires that a minimum of two years from date of discharge has passed AND good credit has been re-established. To get the best interest rate, lenders require a minimum qualifying FICO score of 660 or higher.

CONVENTIONAL FINANCING
The wait period is four years from the discharge date. To get the best interest rate, you need a minimum qualifying FICO score of 720.

Both loan programs allow an exception to the wait period for cases with extenuating circumstances. Example, if the BK was the result of job loss, medical bills due to no insurance, disability etc. If you qualify for the exception, the wait is 1 year for FHA and 2 years for Conventional.

NOTE: differerent rules apply for Chapter 13 AND for consumers who have more than one bankruptcy within seven years.

All the Best,
Barbara
0 votes Thank Flag Link Sat Dec 26, 2009
Lvgal - you can check with local lenders- make sure they know about your discharge and see if they can get the mortgage for you - since the discharge is in place - they may be able to make it happen. Check right away and good luck in your endeavors!
0 votes Thank Flag Link Sat Dec 26, 2009
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