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Even bankruptcy isn’t a permanent black mark. If bankruptcy is in your past, you may be able to apply for a mortgage after a waiting period. But before we get into that, let’s discuss how you can reestablish your credit so mortgage lenders will feel better about the risk when you’re ready to apply.

Reestablishing Credit

Rebuilding credit is a bit like building a house. You have to start with the foundation and work your way up.

You can start by getting a credit card account. You may have to start with a secured account where you put up some of your own money, which functions as the limit for the card. After a few months of making payments, you may be able to apply for an unsecured card so you can show responsibility across multiple credit lines.

It might make sense for you to pay for everything you need with the credit card. The key here is to buy only what you can afford and pay it off completely at the end of every month. In effect, you’ll be treating your credit card a lot more like a debit card, but this behavior will build up your credit every month.

In order to have the best chance of getting a mortgage, you’ll want to build a history of different types of debt. Credit cards are revolving debt. Once you’ve built up some credit with credit cards, it will be easier to get approved for things like installment debt in the form of a personal loan or car loan.

Getting a Mortgage

The most important thing for you to know is that there are waiting periods after a bankruptcy before you can get a mortgage. In most cases, the soonest Quicken Loans can help you refinance your house or get into a new one is one year after the discharge or dismissal of your bankruptcy.

The length of the waiting period depends on the type of bankruptcy you filed for and the type of loan you want to get.

FHA Loans

FHA loans are a pretty good option if you want to get a mortgage after bankruptcy. If you have a Chapter 7 or Chapter 11 bankruptcy in your past, the bankruptcy has to be discharged or dismissed for two years prior to application. If the bankruptcy is a Chapter 13, it can be dismissed just one year prior.

VA Loans

VA loans are another good option. Your Chapter 7 or Chapter 11 bankruptcy must be dismissed for two years before you apply for a VA loan. And there’s no waiting period if you filed for Chapter 13 bankruptcy; you can apply for a mortgage as soon as it’s dismissed.

Conventional Loans

Loans insured through Fannie Mae or Freddie Mac have a major advantage over FHA loans: Mortgage insurance comes off once you reach 20% equity in your home.

Unfortunately, if you try to get a conventional loan after bankruptcy, you’re going to have to wait a little longer. Chapter 7 and Chapter 11 bankruptcies must be dismissed at least four years prior to application for a conventional loan.

In the case of conventional loans with a Chapter 13 bankruptcy, the waiting period depends on whether your loan was discharged or dismissed:

  • If the bankruptcy was discharged, you must wait four years from the date of filing and two years from the date of discharge before applying for a conventional loan.
  • If the bankruptcy was dismissed, the waiting period is four years between dismissal and application.

As with any major financial hit, there’s a road to recovery. Still, if you are diligent and disciplined, you can get a mortgage after bankruptcy. You can talk to one of our Home Loan Experts about your options, or call (888) 728-4702.

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This Post Has 169 Comments

  1. My chapter 7 was discharged june of 2017 my credit is average now.how long do i have to wait to qualify for mortgage?

    1. Hi Jesus:

      We would have an option for you as soon as one year after the bankruptcy discharge. You would have more options two years after the bankruptcy with FHA and VA loans. USDA loan start being viable at three years after discharge. Conventional loans from Fannie Mae and Freddie Mac start four years after the bankruptcy. Since you’re coming up on your year mark, I suggest speaking with one of our Home Loan Experts at (888) 980-6716 to go over your situation.

  2. We filed chapter 7 and it was discharged aug 2017. (Income lowered due to sickness/and owner changed jobs-husband drives a semi for a guy that owns it) We kept our homes and reaffirmed. After bankruptcy we sold one of the places and paid on the note along with bought cows. We now owe $76k left. We are wanting to sell our home and buy a place with land 50-100 ac may or may not have a house. We now have over 50 head of cows. Is there anything we can do or do we have to wait another year? Do you loan on just land?

    1. Hi Christina:

      Unfortunately, the soonest we could help you with anything is August of this year. You would have more options to years after the bankruptcy. We don’t loan on just land. I’m sorry.

  3. i was discharged from bankruptcy in april 2018 i do have 35 percent down to buy a new home , do i still have to wait 2 years

    1. Hi Francesco:

      The soonest we would have any options for you is one year after the bankruptcy discharge. Unfortunately, this is true regardless of your down payment amount. I’m sorry.

  4. We filed for bankruptcy last year, discharge date was in September 2017. We had to file due to our son’s medical bills. We are hoping to get a mortgage this September a year after our discharge date. I have read that in some cases you can be approved in less then a year after bankruptcy if the reason for filing was out of your control or one time loss of income. Since our child being born sick was out of our control is that something you would take into consideration when we would apply for a mortgage.

    1. Hi Crystal:

      I’m going to refer you to one of our Home Loan Experts to make sure you get the best possible information. I can tell you that you’re correct that in the circumstance, you would have to wait until September and that’s the soonest we could help you. There are strict investment guidelines. However, if you call (888) 980-6716 we can start to go over your potential options. My thoughts are with you and your son.

      Thanks,
      Kevin

  5. I declared Chapter 7 bankruptcy about 4 years ago due to a perfect storm of illness and loss of jobs. I make about 130K per year but haven’t been able to save much in a down payment. How much would I need to put down for let’s say a conventional loan after bankruptcy? My credit rating is around 750 btw.

    1. Hi Larry:

      When dealing with a previous chapter 7 bankruptcy, it doesn’t matter as much when the bankruptcy was declared as when it was dismissed or discharged. With that in mind, we have an option for people as soon as a year after dismissal or discharge. You have more options after two years and another potential option after three years if you otherwise qualify. One thing to note is that you can’t get a conventional loan until four years after discharge or dismissal. I’m going to recommend you speak with one of our Home Loan Experts who can go over all of your options at (888) 980-6716. Hope this helps!

      Thanks,
      Kevin Graham

  6. Hello, I have a question regarding home equity loan for some one who had:
    1- Chapter 13 discharged 19 months ago
    2- poor credit scores
    3- looking for home equity loan with manufactured home on land. That is paid full 100 %.
    With approximately 150,500 in equity.
    4- Is there some where we can apply for a HEL of about 65,000?

    1. Hi Pamela:

      Given the dynamics at play here, I’m going to suggest you have this person speak with one of our Home Loan Experts at (888) 980-6716. We don’t do home equity loans, but we do offer cash-out refinances. We could definitely give them some tips and possibly give them a path forward to getting their credit up to where it needs to be. Finally, I would want them to be able to fully go over the manufactured home piece because there are some different regulations around that.

      Thanks,
      Kevin

  7. I recently filed ch 7 bankruptcy its been about a year. I had an injury which left me unable to work for some time. I am looking for a second home which cost 250K ill put down 50K . I have a pension and little expenses now I make about 120K a year. I am defiantly a good risk but i know the ch 7 hurts. any advise

    1. Hi Robbie:

      Since you have a chapter 7 on your record, the soonest we can help you with any kind of mortgage is one year after the dismissal or discharge of the bankruptcy. You would have more loan options available to you after two years. I’m going to recommend you speak with one of our Home Loan Experts by calling (888) 980-6716 and they can go over what you can do now and in the future. Hope this helps!

      Thanks,
      Kevin Graham

  8. Hi, I currently own a home, I have about 130,000 in equity,I filed chapter 13 bankruptcy about 5 and a half years ago, it has been discharged now for about 8 months, my credit score on credit karma is 680 on one and 715 on another. I did reaffirm my home and car at the time of bankruptcy. What I’d like to do is get a home equity loan or a refinace to finish my basement, I’d like about 35 to fourty thousand, how long would i have to wait?

    1. Hi Mike:

      If you get an FHA or VA loan, you could apply now. You would have a couple of other options a year after discharge. For a conventional loan, these must be discharged at least two years for a chapter 13. Call us at 888-980-6716.

      Thanks,
      Kevin

  9. Hello.
    I filed for Bankruptcy 13 in 2013 and will be finished with the payment plan in another 4 months. I own a multi tenant building and there is no mortgage. I need a cash refinance to renovate the building so I can rent out the apts. Would your company be able to assist with my situation?

    1. Hi Andre:

      If you happen to be eligible for a VA loan, we could look at your qualifications as soon as the bankruptcy was discharged. Otherwise, you would have a couple of other options one year after the discharge or dismissal. If you would like to go over your future actions, you can speak with one of our Home Loan Experts by calling (888) 980-6716.

      Thanks,
      Kevin

  10. Hi, I filed chapter 13 and it was discharged March 2016 and the BR will be off credit reports Feb 2018. Currently my loan was transferred to SLS who is terrible along with its reviews. The loan is owned by Freddie Mac……is your company an option for me?

    TY

    1. Based on the information you’re giving me about the timeline of the bankruptcies, we might have a couple of options for you right now and we would have more options for you in March. I’m going to recommend you go ahead and speak with one of our Home Loan Experts. They’d be able to give you more information if you give us a call at (888) 980-6716. Hope this helps!

      Thanks,
      Kevin

  11. Hi, our chapter 7 bankruptcy was discharged in Nov of 2014. I have read you can get an FHA mortgage loan after 2 years from the date of discharge. We have talked to several local FHA lenders but they all tell us 3 years. We found a double-wide on 4 acres of land that we would love to have. It is not on a foundation or basement and the house needs work. We cannot get a conventional loan because it’s not on a foundation. We would love to have this place do you think there’s anything you can do? Our local FHA lender said they would be happy to give us a loan if we come back in January but this place will be gone by then. Thanks

    1. Hi Shane:

      We could look at a loan for you 2 years after discharge. Unfortunately, though, we don’t do any lending on mobile homes including double wide trailers. I’m sorry.

      Thanks,
      Kevin Graham

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