Home Loan After Chapter 7 Bankruptcy

Can I Get Home Loan After Chapter 7 Bankruptcy?

Home Loan After Chapter 7 Bankruptcy

The economic scene has been brutal for many people over the last few years, especially after the financial meltdown of 2008. Many folks dealt with job losses and big financial shifts, which led to a rise in personal bankruptcies.

You can still get a home loan after declaring Chapter 7 bankruptcy. There is usually a waiting period of two to four years, depending on the lender and loan type. However, options are available for those who want to improve their finances. Raising your credit score can help you qualify for a mortgage if you’re looking to buy a house.

There Is Life After Bankruptcy: Qualifying For Home Loan After Chapter 7 Bankruptcy

Many folks who had perfect credit and never missed a payment in their lives were forced to bankruptcy because they lost their jobs.  Losing a job is one thing but never in history of America has a recovery taken so long.  To this date, 8 years after the Great Recession of 2008 the economy has not fully recovered.

The great news is a bankruptcy is a federal law that protects consumers against creditors in the event of financial hardship and gives consumer the opportunity to start over and be debt free.

The other great news is that there is life after bankruptcy and those who had to file bankruptcy in the past can qualify for a mortgage after bankruptcy and can again be homeowners.

Types Of Bankruptcies And Home Loan After Chapter 7 Bankruptcy

There are two types of bankruptcies:

Chapter 7 Bankruptcy and Home Loans

Chapter 7 Bankruptcy is an excellent option for individuals facing considerable unsecured debt and earning a limited income. Just keep in mind that there’s an income cap—if you earn too much, you won’t be able to file for Chapter 7 and might need to look at Chapter 13 instead. If you’re considering buying a home, you can go for an FHA Loan just two years after your Chapter 7 case is over. But if you want a Conventional Loan, you’ll have to wait four years.

Chapter 13 Bankruptcy and Home Loans

Chapter 13 Bankruptcy helps you reorganize your debt. To use this option, you need a steady job or reliable income. This route suits people with income and at least some equity in their home and other assets. When you file for Chapter 13, a Bankruptcy Trustee will help you manage everything. They will review your income and decide how much to give to your creditors. The repayment plan usually lasts between three to five years. After completing the plan, all remaining debts are erased.

If you are in a Chapter 13 Bankruptcy Repayment Plan, you can apply for an FHA Loan after one year, but you need the Trustee’s approval. Once your Chapter 13 is discharged, you can get an FHA Loan immediately. However, if it’s been less than two years since your discharge, you’ll need to go through a manual underwriting process. This means you’ll need to provide proof of your rent payments.

Qualifying For Home Loan After Chapter 7 Bankruptcy

If you have few or no assets, Chapter 7 Bankruptcy can protect you from further collection efforts and wipe out all your debts once it is discharged. After your Chapter 7 Bankruptcy is discharged, you must wait two years before qualifying for an FHA mortgage loan. For a conventional loan, the waiting period is four years after your bankruptcy discharge.

Qualifying For Home Loan After Chapter 13 Bankruptcy

There are two main types of bankruptcy: Chapter 13 is one of them. This type is meant to help people protect their assets and give them time to reorganize their debts. To file for Chapter 13, you must have an income, whether from a job or your business.

If you file for Chapter 13, you must wait one year before qualifying for an FHA-insured mortgage loan. You also need the approval of the bankruptcy trustee.

If your Chapter 13 Bankruptcy is discharged, you can immediately qualify for an FHA-insured mortgage loan with no waiting period. However, if your Chapter 13 is dismissed, you must wait two years before you can get an FHA-insured mortgage loan.

For conventional loans, if your Chapter 13 Bankruptcy is discharged, you need to wait two years from the discharge date. If your Chapter 13 is dismissed, you will have to wait four years from the dismissal date to qualify for a conventional loan.

Judgments And Other Debts

One major benefit of bankruptcy is that it can help you get rid of many judgments against you. Judgments can harm your credit for years and stay on your record for up to ten years. Creditors can sometimes renew these judgments, making them last even longer. This situation can be stressful because creditors may try to collect money from you through wage garnishments or by taking money from your bank account. Filing for bankruptcy frequently helps you eliminate these judgments and lessen your financial burden.

Qualifying For Conventional Home Loan After Chapter 7 Bankruptcy

If you included your mortgage as part of your bankruptcy, the waiting period to qualify for a conventional loan starts from the discharge date of your Chapter 7 Bankruptcy.  Prior to this new Fannie Mae guideline on mortgage part of bankruptcy, the waiting period for those who had mortgage part of bankruptcy started from the recorded date when the deed was transferred out of the homeowners name into the name of the mortgage lender which sometimes took years after the discharge date of the bankruptcy.

Bottom line is that if you have a mortgage part of bankruptcy, the waiting period for both the foreclosure and bankruptcy starts from the discharge date of the bankruptcy and you can qualify for a conventional loan four years from the discharge date of the your bankruptcy.

The foreclosure recorded date can be at a much later date than the discharged date of the Chapter 7 Bankruptcy and that does not matter. The waiting period is four years from the discharged date of the Chapter 7.

Borrowers who need a five-star national mortgage company licensed in 48 states with no overlays and who are experts on home loans after Chapter 7 bankruptcy, please contact us at 800-900-8569, text us for a faster response, or email gcho@gustancho.com.

Frequently Asked Questions About Home Loan After Chapter 7 Bankruptcy:

Q: Can I Really Get a Home Loan After Chapter 7 Bankruptcy?

A: Yes! You can qualify for a home loan after Chapter 7 bankruptcy. There’s a waiting period, but it’s absolutely possible.

Q: How Long Must I Wait for a Home Loan After Chapter 7 Bankruptcy?

A: You must wait 2 years after your Chapter 7 bankruptcy discharge for FHA loans. For conventional loans, it’s a 4-year wait.

Q: Does Bankruptcy Ruin My Chances of Ever Repurchasing a Home?

A: No, bankruptcy doesn’t stop you from buying a home forever. It gives you a fresh start. Many borrowers successfully get a home loan after Chapter 7 bankruptcy.

Q: What Type of Home Loan is Easiest to Get After Chapter 7 Bankruptcy?

A: An FHA loan is usually the easiest home loan after Chapter 7 bankruptcy because the waiting period is shorter and credit guidelines are more flexible.

Q: Do I have to Rebuild My Credit First Before Getting a Home Loan After Chapter 7 Bankruptcy?

A: Yes. Rebuilding your credit right after bankruptcy is important. Pay your bills on time and manage new credit carefully to qualify faster.

Q: Can I Qualify for a Conventional Home Loan After Chapter 7 Bankruptcy?

A: Yes, you can qualify for a conventional home loan 4 years after your Chapter 7 bankruptcy discharge date.

Q: If My Home were Included in the Bankruptcy, Can I Get a New Home Loan?

A: If your former mortgage was part of your bankruptcy, the countdown starts from your bankruptcy discharge date, rather than the foreclosure date. You are eligible for a conventional mortgage 4 years after your discharge.

Q: Can Filing for Bankruptcy Remove Judgments from My Credit Report?

A: Yes, filing Chapter 7 bankruptcy can remove most judgments. This helps clear your financial record, making it easier to get a home loan after Chapter 7 bankruptcy.

Q: What’s the Quickest Home Loan Option After Chapter 7 Bankruptcy?

A: FHA loans offer the quickest route to homeownership after Chapter 7 bankruptcy, requiring only a 2-year waiting period.

Q: Who Can Help Me Qualify for a Home Loan After Chapter 7 Bankruptcy?

A: Mortgage experts specializing in home loans after bankruptcy can guide you through the process and help you get approved. Contacting a mortgage professional is your best step.

This blog about “Qualifying For Home Loan After Chapter 7 Bankruptcy” was updated on July 2nd, 2025.