Chapter 13 Guidelines On Government And Conventional Loans

This Article Is About The Chapter 13 Guidelines On Government And Conventional Loans

Chapter 13 Guidelines On Government And Conventional Loans depends on the individual mortgage loan program. The only two loan program that allow borrowers to be eligible for a mortgage loan during the Chapter 13 Bankruptcy repayment plan are FHA and VA loans. You can qualify for an FHA and/or VA loan during the Chapter 13 Bankruptcy repayment plan without the bankruptcy being discharged. However, you need to be in the Chapter 13 Bankruptcy repayment plan for at least 12 months with timely payments. The bankruptcy trustee needs to sign off on the new home purchase and mortgage. Many people worry about the bankruptcy trustee approval. Trustees understand the importance of housing for people, especially petitioners with families. Trustees want to know homebuyers are able to afford their new housing payment and have the ability to repay. All Chapter 13 Bankruptcy mortgage underwrites are manual underwriting. FHA and VA manual underwriting guidelines are exactly the same. Manual underwriting guidelines applies. Gustan Cho Associates are experts in manual underwriting on FHA and VA loans. Over 25% of our borrowers are FHA and/or VA manual underwriting borrowers.

Chapter 13 Guidelines On Government And Conventional Loans: Difference Between Chapter 7 And Chapter 13 Bankruptcy

Chapter 13 Guidelines On Government And Conventional Loans

Homebuyers and homeowners can qualify for a home purchase and/or refinance mortgage during and after bankruptcy. There are different agency mortgage guidelines on Chapter 7 versus Chapter 13 Bankruptcy. Chapter 7 Bankruptcy normally takes 90 days from the filing date to get discharged. There are mandatory waiting period after Chapter 7 Bankruptcy discharged date on government and conventional loans. You cannot qualify for a mortgage while the Chapter 7 is not discharged. Chapter 7 Bankruptcy is often referred to as total liquidation. You need to take the Chapter 7 Bankruptcy means test to see if you are eligible to file. The means test will determine whether or not your income is eligible to file Chapter 7.

People with little to no income or no job and little to no assets are the ideal candidates for a Chapter 7 Bankruptcy. Otherwise you need to file Chapter 13 Bankruptcy which is a debt restructure program over three to five years. The bankruptcy trustee assigned will determine what percentage of your income will be set aside to pay your creditors over a three to five year term. After the end of the term, the remaining debts is discharged and the person is debt free. People with a full time job and assets to protect are the best candidates for Chapter 13 Bankruptcy. FHA and VA loans require a two year waiting period after Chapter 7 bankruptcy to qualify for FHA and/or VA loans. USDA loans require a 3 year waiting period after Chapter 7. Conventional loans require a 4 year waiting period after Chapter 7 Bankruptcy. Borrowers trying to qualify for a mortgage after bankruptcy need timely payments after bankruptcy and no late payments. Rebuilt and re-established credit is a must to get an approve/eligible per automated underwriting system after bankruptcy.

In the following paragraphs, we will discuss the Chapter 13 Guidelines on government and conventional loans.

Chapter 13 Guidelines On Government And Conventional Loans: Agency Guidelines On Government Loans

Gustan Cho Associates have helped thousands of borrowers get an FHA and/or VA loan approval during the Chapter 13 Bankruptcy repayment plan and has never had a trustee not approve a mortgage loan. Trustees will always sign off on a modest traditional home purchase and/or refinance during the Chapter 13 Bankruptcy repayment period. This holds true even though the Chapter 13 Bankruptcy is not discharged. However, all FHA and/or VA loans during Chapter 13 Bankruptcy repayment plan need to be manual underwriting. FHA and VA manual underwriting guidelines are exactly the same. You do not need trustee approval after Chapter 13 Bankruptcy discharged date. FHA and VA does not have any waiting period requirements after Chapter 13 Bankruptcy discharged date. If the Chapter 13 Bankruptcy discharged date has not been discharged for at least two years, it needs to be a manual underwrite. USDA loans do not allow borrowers to qualify for a USDA loan during Chapter 13 Bankruptcy repayment plan. There is a three year waiting period after Chapter 13 Bankruptcy discharged date to qualify for a USDA loan.

Fannie Mae And Freddie Mac Chapter 13 Guidelines On Conventional Loans

Fannie Mae And Freddie Mac Chapter 13 Guidelines On Conventional Loans

Fannie Mae and Freddie Mac are not government-backed loans. Conventional loans need to conform to Fannie Mae and/or Freddie Mac Agency Guidelines. Fannie Mae and Freddie Mac are government-sponsored enterprises (GSE) and sets the conforming standards on conventional loans. Per Fannie Mae and Freddie Mac Agency Chapter 13 Guidelines on Conventional loans, borrowers cannot qualify for conventional loans during Chapter 13 Bankruptcy repayment period.

Borrowers need to wait two years after Chapter 13 Bankruptcy discharged date to qualify for a conventional loan after Chapter 13 Bankruptcy discharged date. No payments during and after Chapter 13 Bankruptcy is allowed to get an approve/eligible per automated underwriting system. Reestablished and rebuilt credit after bankruptcy is highly recommended for borrowers to get an approve/eligible per automated underwriting system. If the borrowers has a Chapter 13 Bankruptcy dismissal versus a discharge, the waiting period is four years from the dismissal date to qualify for a conventional loan.

Qualify For A Mortgage With A Mortgage Company Licensed In Multiple States With No Lender Overlays

We have discussed in the earlier paragraph there is a four year waiting period after Chapter 7 Bankruptcy discharged date to qualify for a conventional loan. Again, rebuilt and reestablished credit is key to get an approve/eligible per automated underwriting system after bankruptcy. Do not be late on any monthly payments after bankruptcy. Late payments after bankruptcy is the kiss of death.

Most lenders will not approve anyone with late payments after bankruptcy and/or foreclosure. However, Gustan Cho Associates can help people with one or two late payments after bankruptcy to qualify for government and/or conventional loans. To qualify for a mortgage after bankruptcy, please contact us at Gustan Cho Associates at 262-716-8151 or text us for a faster response. Or email us at [email protected] The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays. Gustan Cho Associates are mortgage bankers and correspondent lenders with the ability to broker non-QM and alternative financing mortgage loan programs.

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