House included in BK still considered foreclosed?

[RK05]

My wife has went through a Ch7 BK and included her house in the BK. The house was then foreclosed on by the bank and resold.

Does she have to wait 3yrs to apply for an FHA loan or just two since the house was listed in the BK?

We did not see anything in her credit report regarding the foreclosure but the house was also not sold to another person yet at that time (house was on the market by the bank).

[BassBoy]

If the hom ewas included in the BK, and was not in foreclosure at the time you filed, then the loan will not/should not be listed as foreclosure. The loan should be listed as Included in Bankruptcy. The lender will have to foreclose the mortgage in order to legally take the home and the deed.

When you file for BK and include the home and surrender it, the timeline is 3 years to go FHA. You should show good credit rebuilding and stable income for the last 2 years.

[RK05]

At the time she filled we were trying to sell the house through a short sale. The foreclosure didn't come till six months later.

She would have to wait 3yrs not 2yrs to go FHA? Did they change the rules because I thought it was 2yrs as long as the house was not listed as foreclosed?

Thanks

[BassBoy]

It could be 2 years, but in order for first-timers to tap into the tax credit, you must not have owned a home in the last 3 years, which is why i said 3 years. You'll need to check with a loan officer/mortgage broker who works with FHA loans.

[RK05]

I contacted a loan officer from my local bank and they said 2years out as long as her credit history stayed clean.

I qualify for the existing home buyer program.

Don't know though if we want to wait until November or just buy on my income alone.

[BassBoy]

I knew it was 2 years to buy another home after BK discharge, but I haven't followed up on the new rules/guidelines since things have changed over the last year with the lending industry.

IMO, I would try to always make sure that the purchase of the home is based on one income. It's best for you because you know that you could afford the home if the other isn't employed. Besides, with the second income, that could build up some good savings and really help out if you experience some rainy days.

[RickInMich]

RK05,

I'm very interested in this. Your loan officer knows that the house was foreclosed on later? We included our house in the bankruptcy so no foreclosure shows up either. After discharge, we decided to let it go back. Are you saying that we could get an FHA mortgage 2 years after??? I would really like that to be true!! So many here say it's 3 years, even if the house was included in the bankruptcy and doesn't show up as foreclosed.

[oldhack]

I contacted a loan officer from my local bank and they said 2years out as long as her credit history stayed clean.

I qualify for the existing home buyer program.

Don't know though if we want to wait until November or just buy on my income alone.

Well, frankly, I don't know about the currently-constituted tax credit, but with the last, 'original' $8,000 one -- which I deposited -- if married, you MUST include the spouse on the loan/title. It was NOT optional.
If still so, her status would preclude your solo eligibility.

[Flamingo]

RK05,

I'm very interested in this. Your loan officer knows that the house was foreclosed on later? We included our house in the bankruptcy so no foreclosure shows up either. After discharge, we decided to let it go back. Are you saying that we could get an FHA mortgage 2 years after??? I would really like that to be true!! So many here say it's 3 years, even if the house was included in the bankruptcy and doesn't show up as foreclosed.

While it is listed as included in your BK on your credit reports, it is listed as a foreclosure with the bank so when a property search is done or your former mortgage holder contacted by the broker or possible lender, it all comes out.

[RK05]

My wife went through her BK Before we got married. Right now I am doing everything regarding buying a new home on my credit/income alone.

Oldhack, I will need to look into that because I believe that is up to individual states. In Ohio I don't believe that is the case. If it is we could do a quitclam right after closing to remove her from it.

[RickInMich]

While it is listed as included in your BK on your credit reports, it is listed as a foreclosure with the bank so when a property search is done or your former mortgage holder contacted by the broker or possible lender, it all comes out.

Flamingo, that's what I would think, too, but then we have RK05 saying: "I contacted a loan officer from my local bank and they said 2years out as long as her credit history stayed clean."

Rick

[Ugh07]

It is 3 years from the date the deed is taken out of your name. The debt may be included in Bankruptcy but the Lender will still go through the foreclosure procedure to get a certificate of title. It doesnt matter what your credit says. The underwriter will find the foreclosure proceeding via a public records search.

[sharksfan]

It is 3 years from the date the deed is taken out of your name. The debt may be included in Bankruptcy but the Lender will still go through the foreclosure procedure to get a certificate of title. It doesnt matter what your credit says. The underwriter will find the foreclosure proceeding via a public records search.

Seems like a double whammy. My BK was discharged in 6/2008... haven't made a mortgage payment since 2/2008 (remained current)... a court date has JUST been set to start the foreclosure proceedings.

Credit reports have been cleaned up... etc. This is the last effin piece of the puzzle.

[afterbkloan]

The only encouragement is make sure you work with a lender that has a background or specialty dealing with BKs. My problem is that yes you can call a local bank but most LOs who don't do these type of loans just throw 2 year from discharge reply back at you. I worked with a lot of clients who were disappointed with so many false answers. But yes the lender will go by the date of deed foreclosure.

[sharksfan]

The only encouragement is make sure you work with a lender that has a background or specialty dealing with BKs.

Any recommendations for someone who lends in NY?