My husband and I filed chapter 7 2 years ago and we did not include are house, no reason to. Now we are ready to sell and buy another home. What is?

Asked by Kd770, Dallas, GA Wed Mar 17, 2010

My husband and I filed chapter 7 2 years ago and we did not include are house, no reason to. Now we are ready to sell and buy another home. What is the chances of us having to put down payment in todays market. My neighborhood have foreclose homes and that made the value of our home go down too. Do you think we will have equity in it or loss it because of the value of the home was decrease and will we be able to qualify for the $6,500 tax credit. We are always on time on our mortgage payment but I thought maybe the Chapter 7 casting over our credit will make things harder.

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Wed Mar 17, 2010
Hi Kd770,

I can't answer your question as far as what if any equity you might have or any other real estate related questions but I can answer your questions regarding financing.

With the chapter 7 bk being so "recent" your best/only option will be an FHA loan.
You'll need to discharged from the bk for at least 2 years and have middle credit score of at least a 620.
If you "pulled through" the mortgage you should be fine as far having re-established your credit. The other thing to be aware of is FHA will require a clean credit history after the bk, meaning no late payments on any of your accounts and no new collections or charge offs after the bk .
FHA does require a minimum down payment of 3.5% which can be gift funds from a family member.

To qualify for the $6500 tax credit you have to have lived in your current home for the last 5 years and you need to be under contract on a new home by April 30th and close on the new home by June 30th.
1 vote
Betty Cassa, Agent, Marietta, GA
Mon Sep 19, 2011
I would need more information to answer that question. I would need to do a CMA on your subdivision to determine the value of your property. Then I would need to know how much you owe to determine if you have any equity. You can purchase a home two years after your bankruptcy has been discharged. Hope this helps.
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