Conventional Loan Requirements

Conventional Loan Requirements for 2015 for the most part are the same as 2014 with three major important changes.  First change is that the two year waiting period after short sale and deed in lieu of foreclosure with 20% down payment is no longer in effect.  On the positive note, if you have a mortgage part of bankruptcy, the waiting period is four years from the discharged date of the bankruptcy and not the recorded date of the foreclosure even if the foreclosure is recorded at a later date after the bankruptcy.  The 3% down payment for first time home buyers is now available for conventional loan borrowers.  You can qualify for a conventional loan with 3% down payment if you are a first time home buyer or if you did not own a home for at least three years.

Credit Score Conventional Loan Requirements

Minimum credit score conventional loan requirements is still 620 FICO.  Conventional Mortgage Rates have a direct impact with the borrower’s credit scores, type of property, and loan to value.  To get the best conventional mortgage rates, the conventional mortgage loan borrower needs a 740 FICO credit score, 75% Loan To Value, and the property needs to be a single family home.  The lower a mortgage loan borrower’s credit score, the mortgage lender views the borrower as a riskier borrower so the mortgage rates will be higher on a conventional mortgage loan.  Conventional mortgage loan borrowers with the bare minimum 620 FICO credit score will most likely get the highest rates on conventional loans.

Conventional Loan After Short Sale And Deed In Lieu

The two year waiting period after short sale and deed in lieu of foreclosure with 20% down payment to qualify for a conventional loan is no longer in effect as of last year.  The new conventional loan requirements to qualify for a conventional loan after short sale and deed in lieu of foreclosure has been extended to 4 years from the recorded date of the deed in lieu of foreclosure or 4 years from the date of short sale which is reflected on the HUD Settlement Statement with 5% down payment.

Conventional Loan Requirements If You Have Mortgage Part Of Bankruptcy

If you have a mortgage or mortgages as part of your bankruptcy, the waiting period to qualify for a conventional loan is four years from the discharged date of your bankruptcy and not the recorded date of your foreclosure.  Many home buyers who had a mortgage part of bankruptcy can now qualify for a conventional loan in 4 years from the discharge date of the Chapter 7 Bankruptcy and do not have to worry about going by the recorded date of the foreclosure.

Conventional Loan Requirements On Waiting Period After Chapter 13 Bankruptcy

Conventional Loan Requirements after Chapter 13 Bankruptcy is 2 year waiting period from the discharge date of the Chapter 13 Bankruptcy or 4 years from the dismissal date of the Chapter 13 Bankruptcy.  There are consumers who file Chapter 13 Bankruptcy where they get the Chapter 13 Bankruptcy dismissed and not complete the repayment program.

Conventional Loan After Foreclosure

Conventional Loan Requirements after foreclosure is 7 years from the recorded date of the foreclosure.  Conventional Loan Requirements after foreclosure is different than qualifying for a conventional loan after a deed in lieu of foreclosure and/or short sale.  With FHA Loans, the waiting period to qualify for a FHA Loan is 3 years after the recorded date of the foreclosure, deed in lieu of foreclosure, and the recorded date of their short sale which is reflected on their HUD Settlement Statement.  Waiting period after bankruptcy is 2 years from the discharge date of the Chapter 7 Bankruptcy for a FHA Loan.

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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