Getting a Mortgage Loan After Foreclosure

Getting a mortgage loan after foreclosure

If you are able to repair your credit, maintain a solid credit history for several years and you have saved for a substantial down payment it is likely that mortgage companies will to give you a home loan, but getting approved for a mortgage following foreclosure or bankruptcy will take time.

How long? Because most of the mortgages today are being sold to Fannie Mae or Freddie Mac, or insured by the Federal Housing Administration (FHA), they have set stringent lending standards. Currently if you are getting a home loan after a foreclosure you may have to wait as long as five years, although they have instituted extenuating circumstances which have reduced the waiting period for a foreclosure to as little as three years.

Extenuating circumstance might include a loss of job, severe illness, or unexpected death. If you have a combination of any of the above this may prove that there were extenuating circumstances which did not allow you to repay your previous mortgage debt. Keep in mind you have the burden of proof to convince the mortgage lender that you are financially stable and able to pay your bills, ensuring that foreclosure will not happen again. The best way to do this is to have a high credit score and a large down payment.


Before getting a mortgage after foreclosure you should take some simple steps:

  1. Take out smaller loans and repay them on time.
  2. Start saving for a down payment.
  3. Pay all of your bills on time including student loan payments, car loans, medical bills and credit card payments.
  4. Work with creditors to make sure your credit report does not have any inaccuracies.
  5. Create an emergency account.
  6. Create a budget and stick to it.
  7. Do not cancel all of your credit cards.