When Can I Buy A Home Again After A Foreclosure?

On behalf of Bankruptcy Law Firm of Clare Casas on Saturday, October 30, 2010.

A borrower whose previous principal residence or other real property was foreclosed or has given a deed-in-lieu of foreclosure within the previous three years is generally not eligible for a new FHA-insured mortgage. However, if the foreclosure was the result of documented extenuating circumstances that were beyond the control of the borrower and the borrower has re-established good credit since the foreclosure, the lender may grant an exception to the three-year requirement. Extenuating circumstances include serious illness or death of a wage earner, but do not include the inability to sell the house because of a job transfer or relocation to another area.

If you have a foreclosure and then file bankruptcy in order to eliminate any potential deficiency judgments from the foreclosure, the longer waiting period would apply. For example, if you file bankruptcy and then your house is sold at foreclosure a year later, you would have to wait three years from the date of the foreclosure sale in order to qualify for an FHA mortgage again - even though it's only a two year waiting period after a bankruptcy.