A common question from our pre-license students is "When can a person get a home loan after bankruptcy or foreclosure?" and the answer is always "it depends" for several reasons.
An example we use with our students is that a bankruptcy is different from a foreclosure and they, and many subsets of each, are treated differently by lenders and underwriters. An example of this is that a Chapter 7 bankruptcy filer and a Chapter 13 filer will have different timelines set forth from the discharge or dismissal of their case, and the timeline is a result of the choices made at the time of filing.
Foreclosure and short sale can also be easily confused so real estate professionals are always cautioned to first recommend competent tax and legal advice and second the real estate licensee should suggest that the client or customer also start their homebuying process by visiting with a knowledgable lender who can guide them through the process.
For those looking for information they can share on the probable or likely timeline,we found the infographic below on Credit Karma and thought that this would be a helpful starting point for any discussion related to these issues that a real estate professional might have with any client or customer.
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