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Health & Fitness

Eligibility for a Mortgage after a Bankruptcy is Shorter than You Think

Most people think you can't apply for a mortgage for 7-10 years after filing bankruptcy. The wait can be much shorter.

People who have filed for bankruptcy typically think the wait for applying for a mortgage or refinancing an existing home loan is many years out.  This might be because a bankruptcy filing typically stays on a credit report for 7-10 years. In actuality, the wait can be much shorter.

Consumers who file a Chapter 13 bankruptcy, which requires a repayment plan for what is owed, can apply for a FHA-guaranteed mortgage as soon as one year after the consumer comes out of Chapter 13 reorganization. For those consumers who file a Chapter 7 bankruptcy, which discharges most or all debts, the wait can be as short as 2 years after the Chapter 7 liquidation.

Conventional mortgages guidelines from Fannie Mae and Freddie Mac, call for a wait of two to four years.

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