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     | Sunday, January 09, 2000 - 06:40 am  I just went through a bankruptcy and an FHA foreclosure due to an upside down first mortgage, with a second mortgage behind it. How realistic is it to buy another home before the 10 years of reporting is gone.
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| | Sunday, January 09, 2000 - 07:33 am Jim: See HUD Directive Number 4155.1 at http://www.hudclips.org/sub_nonhud/cgi/nph-brs.cgi?d=HSGH&s1=(4155.1)[no]&op1=AND&l=100&SECT1=TXT_HITS&SECT5=HEHB&u=./hudclips.cgi&p=1&r=4&f=G which states, "D.Previous mortgage foreclosure. A borrower whose previous residence or other real property was foreclosed on or has given a deed-in- lieu of foreclosure within the previous three years is generally not eligible for an insured mortgage. However, if the foreclosure of the borrower's principal residence was the result of extenuating circumstances beyond the borrower's control and the borrower has since established good credit, an exception may be granted. Extenuating circumstances do not include the ability to sell a house when transferring from one area to another." What is the dollar amount of the deficiency balance of the first mortgage?
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| | Monday, January 10, 2000 - 03:19 pm Greg, I owe 81,000 on the first mortgage, and 39,000 on the second, and the house was appraised at 70,500.
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| | Monday, January 10, 2000 - 06:28 pm Ouch! Yet much more important, why did you stop paying?
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| | Tuesday, January 11, 2000 - 05:38 am Jim: What was the sale price of the house after the foreclosure? Was it sold at an auction?
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| | Tuesday, January 11, 2000 - 06:42 pm We bought the house in 1996 for 82,500. Shortly there after we were lured into one of those 125% second mortgages, to pay off 30,000 in credit card debt. Foolishly, we ran the credit cards all back up, and were stuck with a combined mortgage payment of 1250.00. Also with 25,000.00 of credit card debt, we could not afford to pay, we were advised to file bankruptcy and include the house due to the declining value. We hope to buy again but have been told we will have to wait a minimum of 7 years, even with 20% down payment. Also, the foreclosure has just started, so there is no sales price yet. This has been a very tough, depressing time for us, but hope to recover soon. Thanks for listening. Jim.
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| | Tuesday, January 11, 2000 - 09:47 pm Ouch again. I was hoping for a better reason. You're not going to have to wait 7 years, but it all depends on what and where you want to buy AND how you'll handle credit in the future. Underwriting guidelines change all the time. You can't get an approval by pointing at guidelines effective 3 years earlier. How much cash you'll have will be as important as how many new debts you acquired. If your application looks good, you might be able to get a lease option or land contract. Don't worry about buying at this point. Deal with the problems at hand, and immediately after discharge re-establish your credit. Get secured accounts, gas cards, etc. And of course order your credit reports to dispute everything that's incorrect after the discharge. It all takes time, but the sooner you start, the sooner you'll be ready to buy again. If you are compulsive spenders and just can't handle credit, you have a big problem. Hope things get better for you, Christine
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| | Thursday, July 27, 2000 - 06:54 pm Just a possible alternative. I do not know if Jim Walters Homes have been mentioned anywhere on this forum. My wife and I are currently in the same boat. We however have decided to take a different route. Jim Walters Homes are the biggest Builders of "on your lot" homes in America. From what I know of them, they are located mostly throughout the East and South. If you live in this region, you may want to check out their web page. We found that we could get financed in a new home 1 year after bankruptsy discharge. Sorry for the advertisement, but this was good news for our situation.
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| | Thursday, July 27, 2000 - 07:39 pm For those that have had prior BK or forclosures this should help. This is the FNMA/FHLMC Alt-A guidelines. What this mean is that if you are over 620 score 1 year out of BK or F/C you may be eligable for 97% LTV financing. 575 will get you up to 95%. You must meet these guidelines to the letter as there is no flexibility. As for rates: not the best high nines to low ten + MI 30 yr FIX, but pay on time for a couple of years and you could possible refi. If rates keep going up, low 10 may be cheap. Condominiums: Restricted to four stories. Mortgage Insurance: Required on all loans. Credit Score: Minimum 575 credit score with the exception of the following: minimum 620 score required for primary residence purchase or rate and term refinances over 95.00% LTV and second home cash out refinances. Minimum 601 score in the following states if the LTV exceeds 90.00%: GA, NE, NM, NY, and ND. The credit score of the primary borrower (defined as the borrower with at least 50% of the income used to qualify) is used for credit score qualifying purposes. Credit: Minimum of 3 credit references open at least 12 months for each borrower. Exceptions case by case. All adverse credit, including delinquent taxes, must be brought current by loan closing. No 60 day mortgage lates during past 12 months. Collections and charge offs allowed to $500 per account; $2,500 in aggregate. Judgments must be paid. No foreclosures, short sales, or discharged bankruptcies for at least 12 months prior to loan closing. Number of Investment Properties Financed: Borrower may own maximum of 4 investor properties that are financed, including any investor property loans in process. Property Value: No cash out refi uses current appraised value. Cash out refi - value is lower of purchase price or appraisal for first 12 months ownership, then current appraised value is used. Lien Seasoning: Subordinate financing must be seasoned at least 12 months in order to be paid off using no cash out refinance LTV’s. Subordinate financing seasoned less than 12 months is considered “cash out.” Equity lines with net equity advances during the past 12 months the greater of $2,000 or 5% of the equity line amount are considered cash out. Cash Reserve: Loans require, after close, 3 months PITI cash reserve on second home and 6 months PITI on investment property. Appraisal: One required. Qualifying Ratios: Maximum 50/50% ratios.
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