I have just been released from a chapter 13 bankruptcy. What are my chances of getting a mortgage within the the next year or so?

Asked by Linda Stokley Byrd, Wilmer, AL Sat Jul 23, 2011

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Shane Milne, Mortgage Broker Or Lender, South Jordan, UT
Sat Jul 23, 2011
If by "released" you meant "discharged", then if you have 12 months of re-established credit since the Ch 13 BK filing, and no delinquencies (late payments, collections, etc.) since, then with adequate credit scores (600 to 640 with most lenders) you should have a really good chance of qualifying for an FHA or USDA mortgage - right now. FHA mortgages just require 3.5% down, and USDA doesn't require any down payment.

USDA Rural Development financing is 100% financing (you can even finance costs into the loan up to the appraised value, if it appraises over the purchase price). The catch is you have to buy in an eligible area (which Wilmer is), and you can't make too much income, you can check both at http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do - there are two income limits, the "Direct" limit is lower and enables you to apply directly with USDA, and the "Guaranteed" limit is higher and requires you to apply through a mortgage lender.
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