William H. Oliver, Jr. & Associates
Call today for a free consultation
Local 732-988-1500


Bankruptcy may only delay - not derail - home ownership dreams

One common misconception causes debtors who could really benefit from bankruptcy relief to delay or shun filing for Chapter 7.

Many consumers mistakenly believe that filing for bankruptcy precludes their ever qualifying again for a mortgage. While it's true that bankruptcy proceedings can make your plans to purchase a home simmer on the back burner for awhile, if you use that time wisely and pay all of your bills on time each month, you will improve your credit score and be ever closer to your dreams of owning your own home.

What are the waiting periods for a loan?

If you plan to use government-funded loans to purchase a home, below are the typical waiting periods for home buyers who have filed for bankruptcy:

  • VA home loans- two years
  • FHA loans- two years
  • USDA home loans- three years
  • Fannie Mae/Freddie Mac mortgages- four years, or two years if extenuating circumstances existed

Extenuating circumstances might be a one-time occurrence or a series of mishaps that made it impossible for a debtor to continue meeting their financial obligations, e.g., a natural disaster, major illness or serious accident, job loss, etc.

Using your time wisely

In the interim period between your bankruptcy discharge and your application for a mortgage, you should be working hard to re-establish your credit and have no serious derogatory marks since filing for bankruptcy.

What if my home was foreclosed upon?

Foreclosures typically affect consumers' ability to qualify for a loan for seven years. But if your bankruptcy also included the home foreclosure, you may be able to significantly shorten that time.

Here, timing is everything, so check with the Monmouth County Clerk of Court to verify the date of the foreclosure completion. If your foreclosure date was before you filed for bankruptcy, your waiting period begins on the day that your bankruptcy was discharged.

When the sequence of events is reversed and the foreclosure took place after your bankruptcy got discharged, the waiting period my be a bit longer dependent upon the type of loan that you seek.

Get it right the first time

The laws governing bankruptcy proceedings are quite complex, which is why it is always prudent to seek the advice of a New Jersey bankruptcy law attorney before filing.

No Comments

Leave a comment
Comment Information

Get A Free Lawyer Consultation

With offices in Toms River and Neptune, attorney William H. Oliver is ready to answer your questions and help you find the right debt relief solution. Evening and Saturday appointments are available. Call local: 732-988-1500 or fill out our contact form.

Email Us For a Response

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Toms River Office
609 Main Street
Toms River, NJ 08753

Fax: 732-775-7404
Toms River Law Office Map

Neptune Office
2240 State Route 33
Neptune, NJ 07753

Phone: 732-341-1550
Fax: 732-775-7404
Neptune Law Office Map

visa, master card, american express, discover network