Change for the Better on Waiting Period for a Mortgage Included in a Bankruptcy
Fannie Mae (meaning Conventional loans) announced that it is changing its policy (for the better) regarding foreclosed mortgages that were included in a Bankruptcy. The old rule was that the borrower had to wait 7 years after the foreclosure date even if the mortgage debt was included in the Bankruptcy Discharge. The new rule on this scenario, effective immediately, is that the wait period will be 4 years from the date of the Bankruptcy Discharge. The wait period for Foreclosures that were not included in a Bankruptcy will remain the same at 7 years for Conventional loans. FHA continues to require a 3 year wait after the foreclosure date and VA remains at 2 years.