Banker helps woman who filed for bankruptcy buy condo
Mortgage lender: Chris Bartlett Purchase process: $279,900 Loan amount: $265,905
Loan terms: 30-year fixed conventional mortgage
Backstory: Bartlett was recently contacted by woman who was attempting to purchase a condominium but was having a difficult time being approved for a mortgage. Her credit, job and income were good, but she had filed for bankruptcy three years prior.
She had been approved by a few mortgage lenders for an Federal Housing Administration mortgage but because most condominiums in the area are not FHA approved she was having a difficult time finding a unit that met her needs.
FHA is the only loan that al- lows for a borrower to purchase a home two years after a bankruptcy has been discharged provided the person has re-established good credit.
During his communications, Bartlett educated the customers on various loan options and qualifications. He established that she was more interested in obtaining a conventional loan. However, to qualify and purchase a condominium in the complexes she was most interested in, a four-year waiting period was required from the date of bankruptcy discharge.
Her credit history was perfect the year prior to filling the bankruptcy and perfect since the bankruptcy was discharged. When Bartlett asked her the reason for the bankruptcy, she explained that she had been in an accident and suffered a pretty serious head injury.
She was in the hospital for almost a month then in a rehabilitation hospital for three months. Upon being discharged, she moved in with her mother for six months because she was unable to work.
During this time, her bills fell severely behind. After returning to work, almost a year later, she felt there was no way to catch up, and she consulted an attorney who advised her to file for bankruptcy.
Bartlett felt the reason for the bankruptcy would qualify her for a conventional mortgage under the exception within the guideline that allows a person to be approved for a conventional mortgage prior to the four-year waiting period if they can prove the bankruptcy resulted from circumstances beyond their control.
In order to be approved, she would need to provide documentation of everything that occurred prior to her filing the bankruptcy, including medical records, doctors’ letters and accident reports, etc. She was able to provide all of the requested documents and Bartlett submitted her application for underwriting approval with a letter from her explaining the past three years of her life with all of the supporting documents.
Her loan was approved, and she was able to purchase a condo in a complex that she wanted using a conventional mortgage.
While the guidelines on bankruptcy and foreclosures are for the most part black and white, there are exceptions based on circumstance beyond your control. Make sure you tell your story, it matters.