Like many Americans, have your personal circumstances pressed you to consider filing for bankruptcy? Perhaps you have already been recently declared bankrupt. As the current recession has taken hold, bankruptcies across America have surged. In 2008, personal bankruptcies reached over a million filings.
New Mexico, although not as deeply affected as other states, has seen an increase in its number of bankruptcy filings. According to AACER (Automated Access to Court Electronic Records), New Mexico’s total filings increased from 3318 to 4481 from 2007 to 2008 and ranked 40th in state rank based on per capital filings.
The New Mexico Bankruptcy Law Blog defines bankruptcy as “… a legal proceeding in which a person who can not pay his or her bills can get a fresh financial start.”
Appropriately, if you are in the process of establishing your “fresh financial start” and you are planning for your future, you have probably asked, can I buy a house after bankruptcy in New Mexico and how long will I have to wait to do so? Conventional guidelines do not have a very positive answer. Fannie Mae dictates that the minimum waiting period after the discharge or dismissal date is four years except in cases of extenuating circumstances. However, New Mexico FHA home loans after bankruptcy are much more accommodating. The following FHA bankruptcy guidelines answer the question: How long is the waiting period to qualify for a New Mexico FHA mortgage after bankruptcy.
Chapter 7 Bankruptcy:
FHA requires that the minimum waiting time is typically no less than two years from the discharge date. In addition, the borrower must have reestablished good credit or chosen to not incur new credit obligations.
If the borrower can show that the bankruptcy was caused by extenuating circumstances beyond the borrower’s control (e.g. a catastrophic experience such as the death of a primary wage earner) and that he or she has since demonstrated a documented ability to manage his or her financial affairs, the waiting period can be reduced to one year.
Chapter 13 Bankruptcy:
FHA states that a Chapter 13 does not disqualify a borrower from obtaining FHA financing as long as the borrower can show that at least one year of the pay-out period has elapsed under the plan and that all of the required payments have been made on time. Also, the borrower must receive permission from the court to enter into the mortgage transaction.
If you have questions or comments, please contact me or feel free to visit my FHA Loan website.
Steve Lines
FHA Mortgage Specialist
email: slines@bestFHAlender.com
www.bestFHAlender.com
Academy Mortgage
New Mexico Mortgage License #1451
*This is not an offer to lend. 
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