Foreclosure can be a significant financial setback, but it doesn't mean the end of your homeownership dreams. There are strategic steps you can take to qualify for a home loan after a foreclosure. Understanding the requirements and timelines associated with different types of loans can help you plan effectively which is why it's important to work with foreclosure lenders that are familiar with the different programs available. Here are some options on how to secure a home loan after foreclosure.
| Loan Type | Foreclosure Waiting Period | Max Loan-to-Value |
|---|---|---|
| Non-QM | None | 80% |
| FHA | 3 years | 96.5% |
| VA | 2 years | 100% |
| Conventional | 7 years | 97% |
Non QM Loans have no waiting period after a foreclosure but may require a larger down payment and have higher rates than other loan options. If your foreclosure is less than 2 years ago, you usually need to put down at least 20%.
FHA loans have a 3 year waiting period after a foreclosure. The minimum down payment is 3.5% if your credit score is above 580. If your score is lower, you will need to put down at least 10%.
VA loans have a waiting period of 2 years and there is no down payment required. While there is no minimum credit score on a VA loan, a 620 minimum score is recommended.
After a foreclosure, you generally need to wait 7 years to qualify for a conventional loan. The minimum credit score for a conventional loan is 620 and you would need to put down at least 5%.
Getting pre-approved for a mortgage after a foreclosure is quick and easy with our online Loan Application. After completing the application, you will receive instructions on how to upload your documents. For a list of documents that you will need to upload, see our Preapproval Document Checklist.
While a foreclosure can significantly impact your credit and delay your next home purchase, various lending options exist to help overcome this hurdle. Each option has its own set of criteria and waiting periods, so it’s beneficial to prepare and research thoroughly.
At Alpine Mortgage, we can provide personalized advice and help navigate the complex landscape of securing a home loan after foreclosure. With the right approach, recovering from a foreclosure and moving towards homeownership again is entirely possible. Our home loans after a foreclosure are available in the following states: California, Connecticut, Florida, Georgia, New Jersey, New York, Pennsylvania and Texas.
Contact us today at (800) 876-5626 to learn more about our loan options after foreclosure or click here to have one of our foreclosure specialists contact you.
If you would like to apply for a loan after foreclosure, you can apply online now.
A foreclosure can significantly impact your credit score, typically causing it to drop by 85 to 160 points, although the exact amount can vary based on the rest of your credit profile and the score you had before the foreclosure. People with higher credit scores might see a larger drop compared to those with lower scores, as the presence of a major derogatory event like a foreclosure disrupts an otherwise clean credit history more dramatically.
To fix your credit after a foreclosure, focus on these key steps:
You can improve your chances by rebuilding your credit score through consistent, timely payments, reducing your debt, and saving for a down payment. Also, obtaining a stable job and maintaining a solid income record can improve your odds.
