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Mortgage not reaffirmed bankruptcy qualify new mortgage?

Our mortgage was not reaffirmed when we declared bankruptcy and now the mortgage does not appear on our credit report. How does this impact our ability to qualify for a new mortgage?

Michael Jensen, Mortgage and Finance Guru
, Mortgage and Finance Guru

The answer to your question depends on when your bankruptcy occurred. When you fill-out a mortgage application you are required to disclose if you have experienced a bankruptcy or foreclosure within the past seven years. If your bankruptcy occurred more than seven years ago it should not be an issue when you apply for a mortgage. If your bankruptcy occurred within the past seven years and you disclose it on your mortgage application the lender will typically request a copy of your bankruptcy documents. These documents list your mortgage as one of your debts at the time you filed for bankruptcy so the lender will become aware of your prior mortgage even if it is not disclosed on your credit report.

Depending on when your bankruptcy occurred and how your mortgage was treated, you may be required to wait before you apply for another mortgage. We provide a comprehensive overview of the mortgage waiting periods following negative credit events such as a bankruptcy on FREEandCLEAR that you should review. The mortgage waiting period following a bankruptcy is typically four years for a conventional mortgage and two years for an FHA mortgage or VA mortgage.

The waiting periods are shorter if you experienced an extenuating circumstance such as a job loss, medical illness or divorce that contributed to the bankruptcy. The mortgage waiting period following a bankruptcy if you experienced an extenuating circumstance is typically two years for a conventional mortgage, one year for an FHA mortgage and one-to-two years for a VA mortgage. Please note that the lender will require that you document the extenuating circumstance that contributed to the bankruptcy but you may be able to qualify for a mortgage today, depending on your situation.

You should also be aware that the required waiting period before applying for a mortgage following a foreclosure is usually longer than the waiting period following a bankruptcy and can be up to seven years for a conventional mortgage for borrowers without extenuating circumstances. So the answer to your question depends not only on when your bankruptcy occurred but on how your past mortgage was handled by the lender.

We recommend that you contact lenders in your area to understand their guidelines for borrowers who have experienced bankruptcies and other negative credit events as policies can vary by lender. You can contact lenders in your area by clicking INTEREST RATESLike everything on FREEandCLEAR, this feature is free to use and helps you compare lenders to find the mortgage that is right for you.

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About the author

Michael Jensen, Mortgage and Finance Guru

Michael is the co-founder of FREEandCLEAR. Michael possesses extensive knowledge about mortgages and finance and has been writing about mortgages for nearly a decade. His work has been featured in leading national and industry publications. More about Michael

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