2017 HUD Chapter 13 Guidelines

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2017 HUD Chapter 13 Guidelines

2017 HUD Chapter 13 Guidelines: FHA Loans

In this article we are going to look at the 2017 HUD Chapter 13 Guidelines which will only be dealing with how they are treated for FHA Loans.  The reason we will only be looking at FHA Loans is for the fact that HUD (United States Department of Housing and Urban Development) is the parent of FHA.  FHA or the Federal Housing Administration is not a mortgage lender, but rather a government agency that falls under the watch of HUD and creates and sets the FHA Guidelines and in particular for this article, the guidelines dealing with 2017 HUD Chapter 13 Guidelines.

Within the 2017 HUD Chapter 13 Guidelines it treats the Chapter 13 Bankruptcy accordingly.

–          Guidelines state the requirements for borrowers who are in progress in a Chapter 13 Bankruptcy repayment plan

–          Guidelines state the requirements for recently discharged Chapter 13 Bankruptcy

2017 HUD Guidelines: Chapter 7 and Chapter 13

Yes this article is with regards to the 2017 HUD Chapter 13 Guidelines, but it is good to mention the guidelines and timeline dealing with both Chapter 7 AND Chapter 13.

–          Chapter 7 Bankruptcy: When you go through a Chapter 7 Bankruptcy, this is where you can wipe out all of your debts except for student loan debt, this is also known as a total liquidation.  This is just like having a rest button on your credit and everything will go away so to speak.  If it is determined that your income and debts are up to standards, then you can proceed with a Chapter 7 filing.  After your filing is reviewed, within 90 days you will receive confirmation of Discharge which means all included debts in the bankruptcy is no longer your responsibility.  From this Discharge Date, you will have to wait for 2 years in order to qualify for an FHA Loan.  Also, after discharge you cannot have any late-payments when trying to re-establish your credit.

–          Chapter 13 Bankruptcy: A Chapter 13 Bankruptcy occurs when you’d like to repay your debts but can’t afford to facilitate all of them.  A bankruptcy trustee will be appointed to you who will go over your gross income and determine how much you can afford monthly to pay your creditors.  The plan is normally for a period of 60 months and whatever balances remain on the debt after 60 months are wiped out.  If you are looking for an FHA Loan and are currently in a Chapter 13 Bankruptcy, you can get a loan as long as the Bankruptcy Trustee approves this new debt.

2017 HUD Chapter 13 Guidelines: Ways To Qualify

According to 2017 HUD Chapter 13 Guidelines there are 2 ways for you qualify for an FHA Loan as a Chapter 13 Bankruptcy borrower:

  1. If you are currently in a Chapter 13 repayment plan, you can qualify for an FHA Loan as long as you are at least 12 months into your repayment plan and is trustee approved.
  2. If your Chapter 13 Bankruptcy has been discharged, you are eligible to obtain a loan the day after your discharge, however, most lenders will implement a waiting period before they will give you a loan even though 2017 HUD Chapter 13 Guidelines says otherwise.

2017 HUD Chapter 13 Guidelines: In Closing

Even though the 2017 HUD Chapter 13 Guidelines says that there is no waiting period for a Chapter 13 Discharge, if you have not waited 2 years, you can always get an FHA Loan with a manual underwrite as long as you have a VOR or Verification of Rent.  Dealing with a Chapter 13 Bankruptcy and obtaining an FHA Loan could be a tricky subject to navigate, but this is where we come into play for you.  Here at Loan Consultants we are dedicated to helping individuals get FHA Loans during or shortly after a Chapter 13 Bankruptcy.  You can reach us at 888-900-1020 or contact@loanconsultants.org.

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