Sometimes bad things happen to good people. If you’re a veteran who has filed for bankruptcy, you may wonder if you’re still eligible for a VA home loan. Good news! You could be eligible to apply for a VA home loan in as little as 12 months from the time your bankruptcy was discharged. That’s much less of a waiting period compared with other popular loan programs.
The waiting period depends on the type of bankruptcy that was filed. With the most common type of bankruptcy — Chapter 13 — veterans may be eligible to apply for a VA home loan within one year following the date the bankruptcy was discharged. With a Chapter 7 bankruptcy, there’s a two-year waiting period. The exception: If you had a home that was included in your bankruptcy and it was foreclosed upon, then there’s a three-year waiting period.
Regardless of the type of bankruptcy that you filed, know that your spending habits and credit history during the waiting period are critical. That means you will want to focus on making all of your credit payments on time and avoid taking on too much additional debt. In some cases, you may have to ask for permission from a bankruptcy trustee to take on a monthly mortgage payment.
Have questions about the VA home loan program? We’d love to help you. Here’s how you can get started.