Fannie Mae Mortgage Part Of Bankruptcy Guidelines

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Fannie Mae Mortgage Part Of Bankruptcy Guidelines

This BLOG On Fannie Mae Mortgage Part Of Bankruptcy Guidelines Was UPDATED On May 19th, 2018

There are specific waiting periods to qualify for a mortgage after a bankruptcy and foreclosure. Mortgage Part Of Bankruptcy Guidelines differs depending on loan programs. Fannie Mae Mortgage Part Of Bankruptcy Guidelines is much more liberal than mortgage part of bankruptcy guidelines on government loans.

  • Both Fannie Mae and government loan programs have different mortgage part of bankruptcy guidelines to qualify for a residential mortgages
  • For FHA and VA Loans there is a mandatory waiting period of two years after bankruptcy to qualify for mortgage from the date discharge date of Chapter 7
  • There is a three year waiting period after foreclosure, deed in lieu to qualify for a FHA Loans
  • Waiting period is two years after foreclosure, deed in lieu, short sale to qualify for VA Home Loans
  • Home Buyers with a prior mortgage included in Chapter 7 Bankruptcy have the following waiting period requirements:
    • need to wait two years to qualify for FHA loan from the discharge date of the bankruptcy
    • three year waiting period from the recorded date of the foreclosure even though if the mortgage was included in the Chapter 7 bankruptcy
    • Mortgage was included in bankruptcy and the mortgage loan balance was wiped off and charged off on bankruptcy
    • The waiting period does not start until three years from the recorded date of the foreclosure and/or the date of the sheriff’s sale under FHA Mortgage Part Of Bankruptcy Guidelines
  • The good news for conventional loans is Fannie Mae Mortgage Part Of Bankruptcy Guidelines is four years from the Chapter 7 Bankruptcy discharged date
  • Housing event does need to be finalized but the housing event date does not matter

Good News For Fannie Mae Mortgage Part Of Bankruptcy Guidelines For Conventional Loans

The great news for borrowers who had mortgage included in Chapter 7 Bankruptcy.  Fannie Mae Mortgage Part Of Bankruptcy Guidelines states waiting period starts from the date of the bankruptcy discharge date. This is regardless when the foreclosure, deed in lieu is recorded or when the date of the sheriff’s sale is.

  • In general, if borrowers have a standard foreclosure, there is a 7 year waiting period from the recorded date of foreclosure to qualify for a conventional loans
  • However, effective late this year 2014 and going into 2015, borrowers with a prior mortgage part of bankruptcy, the waiting period start clock starts from the date of the bankruptcy discharge date
  • There is a four year waiting period to qualify for a conventional loan if borrowers have a mortgage part of bankruptcy
  • The waiting period time clock starts from the discharge date of the bankruptcy
  • The minimum down payment required is 5% down payment
  • No late payment after the bankruptcy is normally allowed
  • Most mortgage lenders expect re-established credit
  • Mortgage included in bankruptcy cannot be reaffirmed
  • Housing event needs to be finalized

Conventional Loan After Deed In Lieu And Short Sale

The traditional 2 year waiting period after deed in lieu of foreclosure and short sale with 20% down payment is no longer in effect as of August 2014.  The new waiting period after deed in lieu of foreclosure and short sale is now 4 years from the recorded date of the deed in lieu of foreclosure and/or the date of the short sale.  Minimum down payment now is 5% to qualify for a conventional loan after 4 years of deed in lieu of foreclosure and/or short sale.

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