How long after a bankrupt and a foreclosure can you purchase a home?

Asked by Sassime40, Lehighton, PA Fri Jun 15, 2012

Help the community by answering this question:

+ web reference
Web reference:


, ,
Fri Jun 15, 2012
It isn’t as simple as anyone in the industry will normally share, everyone focuses on the minimum timeline and credit score threshold, in addition to those you must meet all of the other requirements as well which will be tricky after a BK.

DO NOT dispute accurate information on your credit report just because it is negative in nature, that is a serious crime regardless of what the “credit repair” experts tell you.
FHA will be the most forgiving avenue available to most people, in addition to the two items mentioned above you must also meet their TOTAL Scorecard, something rarely discussed by LO’s.

Here are a few items I thought may help:

The borrower must have a minimum of at least three (3) current, open trade lines with 12 months history of being paid as agreed, regardless of AUS findings. Alternative trades are acceptable with AUS approval. Examples of alternative trades include utilities, auto insurance and rent.

Rental Verification
If the borrower is currently renting, the rental history must be verified. Rental references on the credit report are acceptable if a rating is provided. A minimum of 12 months must be verified via cancelled checks and/or bank statements if renting from an individual or VOR if completed by management company.

Must be paid in full or have a satisfactory repayment plan is in effect at time of application, established at least 12 months and there have been no late payments on the plan (documentation must be provided to prove satisfactory payments).

Chapter 7
• Two years from discharge date; evidence the applicants have demonstrated ability to handle their credit affairs; and that applicants have re-established acceptable credit.
• Discharged less than two (2) years – NOT eligible.
2 votes
Anna M Brocco, Agent, Williston Park, NY
Fri Jun 15, 2012
Is the bankruptcy discharged, if so much will depend on the type of bankruptcy, the circumstances that led you to that route, current credit, income, etc.; generally it can take two to seven years, if purchasing with a mortgage; for a personalized answer do visit with any licensed loan officer.
1 vote
My NC Homes…, Agent, Chapel Hill, NC
Fri Aug 17, 2012
Two years is the absolute minimum but this is going to require some real work on your part. You've got to realize you've made some significant mistakes financially and it's going to take some work on your part to once again prove that you're mortgage worthy.

You'll need to begins by slowly reestablishing your credit and as you get new credit (think car loan, department store credit cards etc) you must maintain it perfectly for a t least two years. You're going to need tow or more years of solid work history and some money set aside.

For the next 2-3 years you should focus on living below your means, paying off your credit on time and for the most part in full every month. Jim Simms below has offered some excellent specific advice; now it's up to you to buckle down and do what's necessary. I myself went through a personal bankruptcy 20 odd years ago related to Hurricane Hugo. I was able to purchase a home two years later and have since bought and sold, 8 others. Bankruptcy happens for a variety of reasons and some are not always totally in our control, but regardless the first step is to realize you've made mistakes and then to go out there and prove once again that you're worthy of credit .

I wish you all the best.
0 votes
allan erps,A…, Agent, Pearl River, NY
Fri Aug 17, 2012
Jim, it is obvious that you are an expert in your field. Thank you for sharing!!
0 votes
Grace Jorge, Agent, Newark, NJ
Fri Aug 17, 2012
Jim knows his stuff, couldn't have said it better myself.
0 votes
Lynn Ydoyaga, Agent, gouldsboro, PA
Fri Jun 15, 2012
That depends. If you have the funds to buy cash of can do so. If you would like the name & number of a few lenders I will be happy to give them to you.
0 votes
Search Advice
Ask our community a question
Home Buying in Tobyhanna Zip Codes

Email me when…

Learn more