Did someone say the “B” word? Nope, not that word…. I’m talking about Bankruptcy. For those who have had to file, many are embarrassed as think they are one of a very few who have undergone this process. As someone who filed for Chapter 7 Bankruptcy in 2004, I certainly felt this way.
Hardships fall on us all and when it comes to financial hardships, sometimes wiping the slate clean is the only option. This doesn’t mean that the door is shut to homeownership. Even if wiping the slate was a foreclosure or a short sale, the keys may still be yours!
The first step in understanding your options is to know that you are not the only one and mortgage lending professionals see this all the time. The second step is to contact a licensed Mortgage Loan Originator who can help discuss different lending options based on your situation. Typically for bankruptcies, Conventional loan options will allow you to purchase or refinance in 2 to 4 years from your discharge date, depending on which kind of BK you filed. For FHA and VA, you can apply for a new loan in 2 years or less, from your discharge date.
More dramatic financial hardships like foreclosures and short sales are also not unusual. Foreclosures require longer waiting times to apply for a new loan as Conventional needs a full 7 years after completion, and a short sale requires 4 years. However, for both a foreclosure and short sale FHA only requires 3 years and VA only 2 years to apply, after the completion date.
The important message is that lending options are available even after significant adverse credit events have occurred. Mortgage lenders vary in what they offer and they do have different qualifying requirements, so contacting a licensed Mortgage Loan Originator is essential to determine if your qualifications meet those requirements.
– Adrienne L. Randol, CML
Account Executive – Franklin American Mortgage Company
(Disclaimer: The content of this blog is the sole responsibility and opinion of Adrienne L. Randol. The advice and opinions do not guaranty loan approval of any kind and are intended for guidance only. Adrienne is not a licensed loan originator and may not be contacted by consumers to discuss any loan qualification questions. Contact a NMLS licensed Mortgage Loan Originator for any and all loan qualification questions. The content of this blog is valid on the date of publication.)
Bio of Adrienne L. Randol, CML
Adrienne began as a Loan Originator in Cleveland, Ohio in 1999 where she managed and trained a staff of 15 Originators until 2003. She expanded her career by moving to Denver and becoming an Account Executive with National City until 2007. Despite the recession, Adrienne continued to work within the mortgage industry including the MBA (Mortgage Bankers Association) consulting mortgage bankers on Loss Mitigation, Regulatory Compliance, and Fraud Detection. She began as an Account Executive with Franklin American Mortgage Company in 2010, and is a multiple award-winner. Adrienne was a certified CE trainer for Colorado MLOs for 4 years, has been a Certified Mortgage Lender designee since 2011, and has been on the Board of Directors with CoAMP (Colorado Association of Mortgage Professionals) since 2011 and was the first President to be elected for two terms in 2013 and 2014.
