VA Foreclosure Mortgage Guidelines Versus Other Loan Programs

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VA Foreclosure Mortgage Guidelines Versus Other Loan Programs

This BLOG On VA Foreclosure Mortgage Guidelines Versus Other Loan Programs Was PUBLISHED On June 11th, 2019

VA Foreclosure Mortgage Guidelines
Gustan Cho Associates

VA Loans is the best home mortgage program for owner-occupant primary home buyers.

  • However, only active and/or retired members of the United States Armed Services with a valid Certificate of Eligibility (COE) can qualify for VA Loans
  • Spouses of eligible veterans may also be eligible for VA Loans
  • The VA created and launched VA Mortgages to reward our members of the U.S. Military for their service
  • Military Personnel, in general, has lower credit profiles than their civilian counterparts
  • This is because they often have a hard time paying their bills while they are deployed overseas
  • Service Personnel often get transferred every two to three years to different bases
  • It is common to have oversight for veterans in paying their bills timely
  • Due to this reason, the VA has lightened credit/income requirements and standards on VA Loans
  • The VA has much lenient mortgage guidelines than other loan programs

In this blog, we will discuss VA Foreclosure Mortgage Guidelines versus other loan programs.

Mortgage Guidelines After Bankruptcy And/Or Housing Event

Mortgage Guidelines After Bankruptcy And/Or Housing Event
Gustan Cho Associates

All government and conventional loan programs have mandatory waiting period requirements to qualify for home loans.

  • HUD, the parent of FHA, requires a three year waiting period after foreclosure, deed in lieu of foreclosure, short sale
  • The waiting period is two years after Chapter 7 Bankruptcy discharge date on FHA Loans
  • USDA Loans require a three year mandatory waiting period after foreclosure, deed in lieu of foreclosure, short sale and/or bankruptcy discharge date
  • Fannie Mae and Freddie Mac require a four-year waiting period requirement after a short sale and/or deed in lieu of foreclosure on conventional loans
  • There is a seven-year waiting period after a regular foreclosure to qualify for conventional loans
  • There is a four-year waiting period to qualify for conventional loans after Chapter 7 Bankruptcy discharge
  • There are a four-year waiting period requirements after Chapter 13 Bankruptcy dismissal date to qualify for conventional loans
  • The waiting period is two-year after the Chapter 13 Bankruptcy dismissal date

On the next paragraph, we will discuss VA Foreclosure Mortgage Guidelines After A Housing Event.

VA Foreclosure Mortgage Guidelines On VA Loans

VA Foreclosure Mortgage Guidelines On VA Loans
Gustan Cho Associates

VA has the shortest waiting period requirements after foreclosure, deed in lieu of foreclosure, short sale, and bankruptcy.

  • There is a mandatory two-year waiting period requirement after a foreclosure, deed in lieu of foreclosure, short sale, and Chapter 7 Bankruptcy discharge date to qualify for VA Mortgages
  • The waiting period start date after foreclosure and/or deed in lieu of foreclosure is the recorded date of the housing event. It is not the day the homeowner has turned their keys into their lender
  • If the prior mortgage loan that was foreclosed was a VA Loan, the borrower needs to check to see if they have sufficient entitlement on their VA Certificate Of Eligibility (COE)

If the property that was foreclosed was any other loan besides a VA Loan, the borrower should still have full entitlement on their COE.

Non-QM Mortgages With No Waiting Period Requirements After Foreclosure

Non-QM Mortgages With No Waiting Period Requirements After Foreclosure
Gustan Cho Associates

Home buyers who do not want to wait for the mandatory 2-year waiting period requirements after foreclosure, deed in lieu of foreclosure, short sale, bankruptcy, they can qualify for Non-QM Loans. After the 2-year waiting period is up, they can refinance their Non-QM Loan to a VA Loan. Non-QM Loans have no mandatory waiting period requirements after foreclosure, deed in lieu of foreclosure, short sale, bankruptcy. 10% to 20% down payment is required. There is no private mortgage insurance required on Non-QM Loans. There is no maximum loan limit.

For more information in qualifying for a VA Loan after a foreclosure, deed in lieu of foreclosure, short sale, or bankruptcy, please contact us at Gustan Cho Associates at 262-716-8151 or text us for faster response. Or email us at gcho@loancabin.com.

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