Mortgage After Bankruptcy With Late Payments Guidelines

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This ARTICLE On Mortgage After Bankruptcy With Late Payments Guidelines Was PUBLISHED On July 27th, 2020

Mortgage After Bankruptcy With Late Payments Guidelines is not on any agency mortgage manuals.

  • However, lenders frown upon borrowers seeking to qualify for a mortgage after bankruptcy with late payments
  • It is often difficult to get an approve/eligible per automated underwriting system with late payments after bankruptcy
  • It is no problem is getting approved for a mortgage after bankruptcy, foreclosure, short sale, deed in lieu of foreclosure
  • However, late payments after bankruptcy is an automatic denial for most lenders
  • Some lenders will not even look at a file on a borrower with an approve/eligible per AUS if they see the borrower had a late payment after bankruptcy and/or a housing event
  • It is that serious
  • Lenders often refer to borrowers who had late payments after bankruptcy and/or foreclosure a second offense offender

Most lenders do not care about the surrounding circumstances of the late payment after bankruptcy.

Qualifying For A Mortgage After Bankruptcy With Late Payments With A Lender With No Lender Overlays

One of two late payments after bankruptcy is not always a deal killer. It depends on which lender you qualify with.

  • However, Gustan Cho Associates has more of an open mind than other lenders
  • One or two late payments after bankruptcy and/or a housing event is not always a deal killer
  • It is still possible to get an approve/eligible per automated underwriting system with one or two late payments after bankruptcy or foreclosure
  • GCA Mortgage Group has no lender overlays on government and/or conventional loans
  • As long as the borrower gets an approve/eligible per automated underwriting system, Gustan Cho Associates will approve, process, underwrite, and close the loan
  • Gustan Cho Associates is one of the very few national mortgage companies that have no lender overlays on government and conventional loans

In this article, we will discuss and cover qualifying for a Mortgage After Bankruptcy With Late Payments.

Mortgage After Bankruptcy With Late Payments With High Credit Scores

Credit scores are the most important factor in qualifying for a mortgage.

  • Credit scores also play a big role in determining mortgage rates
  • There are many folks who work diligently in re-establishing their credit after the bankruptcy discharged date
  • Many folks who work hard in re-establishing their credit after their bankruptcy discharged date can get their credit scores to over 700 credit scores in less than a year
  • However, it is best to have a lower credit score than have a high credit score with a late payment after bankruptcy
  • A borrower with a 580 credit score with no late payments after bankruptcy will definitely get an FHA loan approval with no hiccups
  • However, a 700 credit score borrower with a late payment after bankruptcy may not get approved for an FHA loan
  • Consumers who filed bankruptcy and got it discharged need to consciously monitor their credit reports and make all their monthly debt payments on time
  • This holds especially true if they are planning on applying for a mortgage after bankruptcy

Your credit report should be monitored just like your bank statements.

How Mortgage Underwriters View Derogatory Credit Tradelines Versus Late Payments

The mortgage industry is very forgiving with PRIOR bad credit and derogatory credit tradelines.

  • Lenders are so forgiving on PRIOR derogatory credit tradelines that outstanding collections and charged-off accounts do not have to be paid to qualify for an owner-occupant primary home mortgage
  • Borrowers with a prior bankruptcy, foreclosure, a deed in lieu of foreclosure, a short sale can qualify for a mortgage after meeting the minimum waiting period guidelines
  • However, lenders understand a prior bankruptcy, foreclosure, deed in lieu of foreclosure, short sale, and periods of bad credit is a one time chance
  • You get just one chance of having a period of bad credit
  • All lenders expect no late payments after the period of bad credit
  • Lenders want to see re-established credit and timely payment history with ZERO late payments
  • Again, one or two late payments may or may not be a deal killer
  • The automated underwriting system has been programmed to scrutinize any late payments after bankruptcy, foreclosure, or periods of bad credit
  • As mentioned earlier, it is better to have a lower credit score with no late payments after bankruptcy versus a high credit score with late payments

Timely payments are a great indicator the borrower will be timely with their new mortgage payment.

Qualifying For A Mortgage With A Lender With No Overlays

Gustan Cho Associates has a national five-star reputation of not having any lender overlays on government and conventional loans. Over 75% of our borrowers are folks who could not qualify at other lenders due to their overlays. If you are looking for a lender with no overlays on government and conventional loans, please contact us at Gustan Cho Associates at 262-716-8151 or text us for a faster response. Or email us at gcho@gustancho.com. The team at GCA Mortgage Group is available 7 days a week, evenings, weekends, and holidays.

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