Yes, it is possible to get a home loan following a bankruptcy with an FHA mortgage loan. Some borrowers, including first-time home buyers, assume that after a Chapter 7 or Chapter 13 bankruptcy filing that it is impossible to get a new home loan.
Others assume you must wait seven years or longer to apply for a new home loan. What's the reality?
The most important thing about getting a new loan after bankruptcy is when you apply, and following that the most important issues include whether or not your bankruptcy has been discharged or not.
FHA home loans are possible but only after the bankruptcy has been discharged, not after they have been initially filed.
After a bankruptcy has been discharged, there is a minimum and mandatory waiting time known as a seasoning period-this is a minimum of one year (no exceptions) in most cases, but can be two years or longer.
You may be required to provide documentation to the lender to show that the bankruptcy was beyond your control and is not likely to happen again. Additional documentation may be required to show patterns of responsible credit use following the bankruptcy.
In certain bankruptcy situations you may need the court's written permission to proceed with a new home loan.
FHA loan rules may require you to provide further documentation depending on circumstances. One of those circumstances is any situation where the borrower's credit report does not reflect the bankruptcy fully in terms of whether financial liabilities were discharged, etc.
Lender standards will vary for these situations, so you will need to discuss any concerns you have with the loan officer to determine what lender requirements may apply in your circumstances.