Bl2000s10, Home Buyer in South Whitley, IN

I filed for bankryputcy. Discharged on 1/24/11. Is there anyway I could buy another home? Soon?

Asked by Bl2000s10, South Whitley, IN Tue Mar 1, 2011

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Dianne Y. A…, Mortgage Broker Or Lender, San Antonio, TX
Tue Mar 1, 2011
Dear B12000s10,

There are two types of bankruptcy: Chapter 7 and Chapter 13. In Chapter 7, all of the debts are discharged and your slate is wiped clean. In the Chapter 13, you pay to a Bankruptcy judge monthly installments generally over a five-year period. In the Chapter 7, you will have to wait two years from the date of discharge in order to qualify for a conforming loan as Joe stated earlier. However, in the Chapter 13 (usually called the wage-earner plan), it's from the time of filing, which is typically two years. So, you would be able to apply for a FHA loan in the middle of a Chapter 13, provided you paid into the plan as agreed.

The question is which type of bankruptcy did you file? If you filed a Chapter 7, then, you would not be eligible until 1/25/13. If it's Chapter 13, then you would be eligible now. In the case of a Chapter 7, you could purchase a home on Seller financed, provided the Seller owns the property outright. Be sure to consult an attorney before entering this type of contract to ensure 1) that the Seller actually is the owner and 2) that there is language in the contract that protects you. More than likely the attorney will run a title search for verification purposes.

But, before you buy, be sure to analyze the reasons that you feel that you need to buy now. Do the pros and cons of buying now and the advantages of waiting the two years to get the right rate and term.

Best of luck to you!

Dianne Y. Ayala Steffey, MBA, CLU, ChFC, NMLS#267658
Your Personal Mortgage Consultant for Life!
Sterling Mortgage Services NMLS#373771
2929 Mossrock, Ste 222
San Antonio, TX 78230
210.349.1544 fax
210.831.8749 cell
2 votes
John Walin, Agent, Libertyville, IL
Sun Mar 31, 2013
great answer Diane, thumbs up to you
0 votes
connielee260, Home Buyer, Shipshewana, IN
Sun Mar 31, 2013
I have a home that needs a face lift inside and out. But it is loon lake with access to the lake. I have three dogs and need a place with a bigger yard.
I would sell as is where is on contract for 50,000.00 ; with 20,000 down @ 8% interest for three years. If you are interested. A 3 year ballon due at that time. Payments monthly app: 400.00 mo. and taxes and insurances anohter 100.00 totalling 500.00 mo for three years with balance due.
0 votes
Diana Evans, Agent, Fort Wayne, IN
Fri Apr 13, 2012
You may be eligable depending on what type of bankruptcy. Some Lenders may be able to assist you or at least give you a time line of getting your credit score increased. I would be happy to share a Lender that will be able to answer all your questions. Please call me 260-436-6363 ask for Diana
0 votes
Joseph Finne…, Agent, Bethlehem, PA
Tue Mar 1, 2011
If you wish to use typical financing like an FHA mortgage you will need to wait 2 years from the date the bankrupty was discharged. If there were extenuating circumstances such as the bankrupty was due to health problems and you had good credit before you can ask for an exception after 1 year (divorce doesn't count).


Joe Finnerty
Long & Foster Real Estate, Inc.
Lehigh Valley Office, PA
0 votes
Katee Huyghue, Agent, Chino, CA
Tue Mar 1, 2011
The most likely lender for a buyer in your situation is going to be a Hard Money Lender. This particular loan requires 30% - 40% down payment, but does not rely on your credit score. Depending upon the lender, there will be other requirements - one of which will be a much higher interest rate. So, do some online research for Hard Money Lenders. Good Luck
0 votes
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