FHA Mortgage Loans - An Option For Severely Damaged Credit

One of the most attractive features of an FHAbankruptcy under chapter 7 an FHA loan may be
mortgage loan is that you can qualify with evenavailable if the discharge date is 2 years old (Not the
severely damaged credit. This means if you have afiling date). You must also give a complete and detailed
foreclosure or bankruptcy (chapter 7 or 13) on yourexplanation regarding the bankruptcy as well as prove
credit record, qualifying for the home of your dreamsemployment and financial responsibility (paying debts
may still be very well within reach.on time over the last 2 years)
This is because FHA does not have a specific lowerChapter 13 bankruptcy - If you have actively paying on
limit regarding FICO scores. FHA lenders who processa chapter 13 bankruptcy for at least 1 year, you may
and approve your FHA loan assume no risk becausevery well be considered for an FHA loan. What you'll
the Federal government insures all loans in the eventneed in this case is the court trustee's written approval
that you default.move forward with the loan. Of course you'll still need
Foreclosure - If you have previously defaulted on ato prove income, employment and creditworthiness as
primary residence, an FHA insured mortgage will bewell as complete and detailed explanation regarding
available as long as the foreclosure or deed-in-lieu ofthe bankruptcy.
foreclosure was not within the last 3 years. This rule isKeep in mind FHA doesn't actually make the loans,
somewhat flexible as well. If there were extenuatingthey just insure the lenders who make the loans. This
circumstances causing the foreclosure that aremeans that there may be very minor variances in
explainable it is possible to waive the strict 3-year rule.qualifications but you can generally assume consistent
Chapter 7 bankruptcy - If you have filed forbasic program guidelines from lender to lender.