Tag: Chapter 7

Waiting Period After Bankruptcy When Home is Re-Affirmed

Question: If a client has a Chapter 7 Bankruptcy, but the house was re-affirmed and they kept the house, is the waiting period 2 years or 4 years? Derogatory Credit Chart Answer: Mortgage Currentcy has a great Derogatory Credit Chart which we are linking below. The agencies do not consider whether or not the home […]

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VA-Revision of Lenders Handbook-Chapter 7 [Loans Requiring Special UW] and Chapter 10 [Property Eligibility & Appraisals] Dated March 19, 2019 – Effective June 9, 2019

Written By: Tracey Rumsey, Staff Writer Heads Up VA originators, processors, underwriters and operations staff.  VA has lined up major changes that anyone touching a VA file needs to be aware of.  Read through this update where we specifically address Chapter updates 7 & 10. Rule Synopsis: VA announced at the Lenders Conference in April […]

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FHA – Repeated Bankruptcy: If a client has a Chapter 7 in 2012 and a Chapter 13 that was recently dismissed due to withdraw, will FHA allow this? [Derogatory Credit Wait Periods – All Agencies – Chart]

Answer: The Chapter 7 wait period is well past, and FHA has no mandatory wait periods after a Chapter 13 dismissal, and does not discuss this event at all in their guidelines. That said, prudent underwriting would require a lot of scrutiny on the borrower’s payment history for the last 12-24 months as well as explanations regarding the borrower’s […]

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FHA & USDA – Chapter 7 – Mortgage Included: If the Buyer filed chapter 7 and included a home mortgage, does the waiting period start from the Chapter 7 discharge date or the Deed transfer date? [NEW MTP – Credit Issues – Am I Ready to Buy?]

Answer – FHA: FHA does not directly address this scenario in their guidance. My answer is based on verbal instruction I have been given by the HOC.  Of course, you will be subject to your underwriter’s determination. FHA has a very different view than Fannie/Freddie when it comes to mortgages that are included in a bankruptcy. Again, I have […]

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