Looking for options - Bankruptcy fell off Credit Report - Home underwater

Housebroken13

LoanSafe Member
Jul 17, 2009
814
13
18
Hi,

Located in CT.
Filed BK in 2009 (home was discharged therein).
Stayed and paid in home; currently underwater.
Bankruptcy just came off of credit report.

Need a larger space for growing family.
Mortgage payment made every month (rolling 60 days late - I pay at day 59)

What are options to get new home loan and out of this house?

Thank you in advance!
 

OneHugeMess

LoanSafe Member
May 30, 2016
436
31
28
Your biggest problem is your going to have a 30 or even 60 Day Late Payment Remark, for every single month on your Credit Report, and from what I recall -- most conventional programs require you to have less than two 30 Day Delinquencies in the Past Year, and No more than one 60 in the past two.

What are your scores like? And can you rent the house out now, for more than your current payment?

Honestly, you may be in a position where you just have to walk away, and rent a new home unfortunately.

Did you speak with Erik Sandstorm by chance?
https://lo.primelending.com/erik.sandstrom
 

Housebroken13

LoanSafe Member
Jul 17, 2009
814
13
18
Thanks for replying. My credit score is in the low 600's. (mostly CC debt that we are paying off as part of bigger plan) My BK public record just dropped off my CR 2 weeks ago.

Since the mortgage was included in my BK they are no longer reporting my payments to the credit bureaus.

I keep a record of my payment confirmations and they also send me what they call "periodic statements"
 

Housebroken13

LoanSafe Member
Jul 17, 2009
814
13
18
I should add that we have plenty of income for a larger mortgage payment if necessary; assume that helps DTI ratio...
 

OneHugeMess

LoanSafe Member
May 30, 2016
436
31
28
You could probably get into a FHA Program, but with your scores you probably will not qualify for a traditional Fannie or Freddie. Ideally, you’d get into the 660’s, before you apply.

You should really reach out to Erik.
 

Housebroken13

LoanSafe Member
Jul 17, 2009
814
13
18
Thanks. I did send him an email directly the other day. Waiting to hear back.

Any idea around the waiting period for the FHA?

Assuming it would default to the original date of of BK and not the short sale if I went that route.
 

OneHugeMess

LoanSafe Member
May 30, 2016
436
31
28
Waiting Period can be as little as one day in extraordinary documented circumstances, and as little as two years after a Bankruptcy for regular underwriting. The waiting period for foreclosure will mostly depend on the Lenders overlay and addon requirements.

Like I said -- I think you should let Erik look into your situation. He'll be able to give you a much better outlook of your options. There are also new Non-QM loans that might be able to help.
 

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Jan 14, 2011
2,040
160
63
San Diego, California
www.loansreduced.com
Hi Housebroken13,
I came down with a nasty flu and was out for the count but I believe I sent you the payment history guidelines on both FHA and conventional. Just because you included your home in BK doesn't mean that you won't qualify for a new purchase.

Depending on what you're looking to do the mortgage can be taken care of a few different ways regarding qualifying on a new purchase, for example:

Non-Contingent purchase - where you qualify to purchase a new home with the liability on your current home. A way to do this would be to list the property as a rental and use rental income to offset the liability. Of course if you qualify for the new purchase without that it's slightly easier in underwriting.

Contingent Purchase - If you're planning on selling the home and using proceeds as a down payment on the new home you would want to ensure you list it as this in the contract.

I would be happy to help in any way I can. I have a few e-mails that I'm going to be catching up on but please call me/text or e-mail anytime. 619-379-8999. [email protected]

I'm able to originate in almost every state in the country, the ones I can't at the moment but my colleague can are: DC, Maine, Massachusetts, New Jersey (pending licensing), New York, Maryland, Rhode Island, Vermont and West Virginia. Many people will still call me in these states and I'm always happy just providing my advice whether you decide to work with me or not...I've been a part of LoanSafe for years now and strive on educating. The satisfaction is priceless knowing that you helped someone achieve something they didn't think was possible.