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Homebuyers with Chapter 7 or 13 can still qualify, agents should ask timelines
HousingWire says the key difference is how lenders treat Chapter 7 versus Chapter 13, with waiting periods and loan programs varying by the filing type.
HousingWire discusses how bankruptcy can be a legal process rather than an automatic barrier to buying a home, noting that buyers have gone from discharge to closing day, sometimes faster than expected. The article says the Chapter 7 versus Chapter 13 distinction matters because different mortgage loan programs treat each filing differently, including different waiting periods. It also cautions agents that the bankruptcy itself is not always the biggest obstacle, since lenders look at the entire profile, including income stability, credit management since filing, and whether the buyer has enough savings to close.
HousingWire advises agents to start with a lender early and to ask timeline and income questions while keeping the home search and spending aligned with the buyer’s preapproval. It also recommends agents avoid giving firm financing answers themselves and instead connect clients with an experienced loan officer who handles post-bankruptcy files.
The piece adds that conventional loans often have longer waiting periods after bankruptcy than FHA loans, while it notes that VA loans can offer flexibility for eligible veterans and USDA loans follow their own guidelines, with individual lenders sometimes applying additional requirements.