Mortgage Resources

What are the Waiting Periods for Bankruptcy or Short Sale before getting a new Mortgage?

Extenuating circumstances could cut the waiting period to two years for Chapter 7 and Short Sale It can be pretty daunting to keep up with the waiting periods that different loan programs require before you can qualify for a new mortgage loan. Fannie Mae and Freddie Mac are the two agencies that issue a typical conventional mortgage loan. Below is a table you can use as a reference. Please contact us with any questions.

Fannie Mae vs Freddie Mac

Waiting Periods for Derogatory Credit

 

(Effective October 2014)

FANNIE MAE FREDDIE MAC

Derogatory Event

Waiting Period Requirements

Waiting Period with Extenuating Circumstances

Waiting Period Requirements

Waiting Period with Extenuating Circumstances
Bankruptcy Chapter 7 or 11 4 years 2 years Defined by Loan Prospector Automated Underwriting System Defined by Loan Prospector Automated Underwriting System
 BankruptcyChapter 13
  • 2 years from discharge date
  • 4 years from dismissal date
  • 2 years from discharge date
  • 2 years from dismissal date
 Defined by Loan Prospector Automated Underwriting System Defined by Loan Prospector Automated Underwriting System
Multiple Bankruptcy Filings 5 years if more than one filing within thepast 7 years 3 years from the most recent discharge or dismissal date Defined by Loan Prospector Automated Underwriting System Defined by Loan Prospector Automated Underwriting System
Foreclosure * 7 years 3 years up to 7 years:

  • 90% maximum LTV ratios
  • Purchase, principal residence
  • Limited cash-out refi, all occupancy types
 Defined by Loan Prospector Automated Underwriting System Defined by Loan Prospector Automated Underwriting System
Deed-in-Lieu Preforeclosure Sale (aka Short sale), or Charge-Off of Mortgage Account
  • 4 years – **LTV ratios per the Eligibility Matrix
 2 years – **LTV ratios per the Eligibility Matrix Defined by Loan Prospector Automated Underwriting System – see below for important information for Short Sales Defined by Loan Prospector Automated Underwriting System – see below for important information for Short Sales

 Contact a licensed loan officer for specific parameters for both Fannie Mae and Freddie Mac Waiting Periods after a significant derogatory event.