Buying A Home Refinancing

How to Refinance an FHA Loan After Bankruptcy

You’ll Have to Meet the Eligibility Guidelines

Refinancing an FHA is a little different than refinancing a conventional loan in terms of what lenders require but there are still some specific criteria you have to meet. For starters, you have to have re-established your credit since your bankruptcy filing. Generally, you’ll need a minimum credit score of at least 580 to qualify and you have to be current on your mortgage with no late payments.

You’ll also need to have at least 3.5 percent of the home’s value to put towards a down payment. If your credit score is on the lower end of the scale, you may be able to improve your chances of getting approved by bumping up your down payment to 10 percent.

You Can Fast-Track the Process with a Streamline Refinance

If you’re not interested in pulling any equity out of your home, the FHA Streamline Refinance program is worth a look. A streamline refinance is a good option if you’re underwater on the home, since there’s no appraisal required and unlike a cash-out refinance, you’re not required to show proof of income to qualify.

As far as the credit requirements go, the FHA doesn’t have a minimum score that’s required. You may still have to meet the bank’s requirements, however, and most lenders typically look for something in the 620 to 640 range at minimum. The most important caveat of a streamline refinance is that it must lower your monthly payment by at least five percent.

About the author

Rebecca Lake

Rebecca Lake is a personal finance writer and blogger specializing in topics related to mortgages, retirement and business credit. Her work has appeared in a variety of outlets around the web, including Smart Asset and Money Crashers. You can find her on Twitter at @seemomwrite or her website, RebeccaLake.net.

1 Comment

  • I file chapter 13 and it was discharge in Mar.28,2013 and now I would like to get a mortgage and the banks are saying that I have to wait until it is 4 years before I can get another mortgage. Is there any chance I could get another mortgage now because my lease will be up in Sept. and we would like to get a mortgage now to move by the time are lease is up. Or do I have to wait until it is up?

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