Home Buying in 21133>Question Details

Nicole Wilson, Home Buyer in Randallstown, MD

Is it true that FHA change there guidelines that now you only have to be 1 year out of Bankruptcy to get a FHA Loan..?

Asked by Nicole Wilson, Randallstown, MD Thu Aug 22, 2013

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Lanre Folayan’s answer
Nicole the best person to answer this question is a Local Loan Officer or Lender. Of course I can defintely recommend some to you if you need it. Good luck to you in getting your question answered. Have a great weekend.
0 votes Thank Flag Link Fri Aug 23, 2013
Yes. You may qualify for the HUD back to work program where you would be able to buy just 12 months after a bk or foreclosure. Check out the link below to read up on it, we can get you with lenders that offer the program to see if you qualify. Hope this helps
1 vote Thank Flag Link Tue Dec 17, 2013
The new Program is called FHA Back to Work Program. It changes the guidelines for the wait period for bankruptcy, foreclosure, and short sales down to a minimum of 12 months but only for extenuating circumstances that are a direct result of either a job loss or loss of income of at least 20%.

I did a video that covers the whole program at http://youtu.be/kCb7Xku2x0k

If you would like more information or to apply for the FHA back to work program please feel free to call me at 410-412-3319

John R. Thomas
Certified Mortgage Planner - NMLS 38783
Primary Residential Mortgage, Inc
410-412-3319 Office
1 vote Thank Flag Link Tue Dec 17, 2013
Helo Nicole,

From FHA - keep in mind that many banks have overlays that state the borrower must be 2 years out of bankruptcy, even though FHA states one in some instances.


Chapter 13 Bankruptcy

A Chapter 13 bankruptcy does not disqualify a borrower from obtaining an FHA-insured mortgage, provided that the lender documents that

· one year of the pay-out period under the bankruptcy has elapsed

· the borrower’s payment performance has been satisfactory and all required

· payments have been made on time, and

· the borrower has received written permission from bankruptcy court to enter into the mortgage transaction.

TOTAL Scorecard Accept/Approve Recommendation

Lender documentation must show two years from the discharge date of a Chapter 13 bankruptcy. If the Chapter 13 bankruptcy has not been discharged for a minimum period of two years, the loan must be downgraded to a Refer and evaluated by a Direct Endorsement (DE) underwriter.

Review Rules for TOTAL are limited to:

· excessive qualifying ratios;

· a previous mortgage foreclosure within 3 years;

· a bankruptcy discharged within 2 years, and

· late mortgage payments

TOTAL Scorecard User Guide Section 2.3


Both Chapter 7 and Chapter 13 bankruptcies discharged less than 2 years from the date of the loan application require the mortgage application to be downgraded to a Refer and provided to a DE underwriter to ensure compliance with the instructions regarding bankruptcies described in HUD Handbook 4155.1. A borrower whose bankruptcy has been discharged less than 1 year generally is not eligible for FHA mortgage insurance.

If the bankruptcy was discharged at least 2 years from the date of the loan application and the risk-classification from TOTAL is an Accept, no further documentation regarding the bankruptcy is required.

Feel free to call me on 202 573-6035 if you have any additional questions.


Catherine Purcell
Senior Mortgage Loan Officer
Fairway Independent Mortgage Corporation
cell 202 573-6035
1 vote Thank Flag Link Thu Aug 22, 2013
Yes this is certainly true but the bankruptcy and finances have some restrictions in order to qualify after a year.

Brian Nguyen
Sr. Mortgage Banker
NMLS # 659743
Phone: 949.667.2887
0 votes Thank Flag Link Mon Feb 24, 2014
Hello Nicole,

From my understanding it was three years coupled with your credit score. if you need a Loan Officer to assist you with the quidelines let me know or visit the site for some.
0 votes Thank Flag Link Thu Aug 22, 2013
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