Howlong do potential buyers need to wait after a Bankruptcy, Foreclosure or ShortSale before obtaining financing?
This is a frequent question these days.
Below is a summary, by loan type, of the waiting period to obtain financing post a BK, Foreclosure or Short Sale.
Conventional
Chapter 7 Bankruptcy → 4 years from discharge date
Chapter 13 Bankruptcy → 2 years from discharge date
Foreclosure →5 years from completion date
Deed-In-Lieu of Foreclosure → 4 years from completion date
Short Sale → 2 years from completion date
FHA
Chapter 7 Bankruptcy → 2 years from discharge date
Chapter 13 Bankruptcy → 1 year of the payout must elapse & payment performance must be satisfactory buyer must receive permission from the court to enter into a mortgage
Foreclosure → 3 years from completion date
Short Sale → 3 years from completion date
VA
Chapter 7 Bankruptcy → 2 years from discharge date
Chapter 13 Bankruptcy → 1 year of the payout must elapse & payment performance must be satisfactory; buyer must receive permission from the court to enter into a mortgage
Foreclosure → 2 years from completion date
Short Sale →No specific information on this yet, assume foreclosure rule of 2 years
USDARural
Bankruptcy (Ch.7&Ch.13) → 3 years from discharge date
Foreclosure → 3 years from completion date
Short Sale → No specific information on this yet, assume foreclosure rule of 3 years
