One of the pretty common financing questions I hear these days is, “how long do I need to wait to obtain financing after a bankruptcy, foreclosure or short sale?” Matthew Belmont, Sr. Mortgage Consultant with On Q Financial provided the following outline of the waiting periods by loan type.
Conventional Loan
- Chapter 7 Bankruptcy ~ 4 years from discharge date
- Chapter 13 Bankruptcy ~ 2 years from discharge date
- Foreclosure ~ 4 years from completion date
- Deed-In-Lieu of Foreclosure ~ 4 years from completion date
- Short Sale ~ 2 years from completion date
FHA Loan
- Chapter 7 Bankruptcy ~ 2 years from discharge date
- Chapter 13 Bankruptcy ~ 1 year of the payout must elapse & payment performance must be satisfactory – buyer must receive permission from the court to enter into a mortgage
- Foreclosure ~ 3 years from completion date
- Short Sale ~ 1 year from completion date if the borrower was current at the time of the short sale and all installment payments for a 12 month period~ 3 years from completion date if in default at time of short sale
VA Loan
- Chapter 7 Bankruptcy ~ 2 years from discharge date
- Chapter 13 Bankruptcy ~ 1 year of the payout must elapse & payment performance must be satisfactory – buyer must receive permission from the court to enter into a mortgage
- Foreclosure ~ 2 years from completion date
- Short Sale ~ No specific information on this yet, assume foreclosure rule of 2 years
USDA Rural Loan
- Bankruptcy (Ch 7 & 13) ~ 3 years from discharge date
- Foreclosure ~ 3 years from completion date
- Short Sale ~ No specific information on this yet, assume foreclosure rule of 3 years
Do you have additional questions about financing? Feel free to contact Matthew at 480-236-3541 or matthew.belmont@onqfinancial.com
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