FHA Bankruptcy Rules: Quick Guide for Homebuyers

If you filed for bankruptcy and still want an FHA loan, you’re not out of options. The FHA has clear rules about how long you must wait, what credit score you need, and how to prove you’re back on track. This guide walks you through the basics so you can plan your next move.

Waiting Periods After Bankruptcy

The FHA requires a waiting period before you can apply for a new loan. For a Chapter 7 filing, the clock starts at 2 years from the discharge date. A Chapter 13 case gives you a shorter window—usually 1 year after you finish the repayment plan. If you’re still in Chapter 13, you may qualify sooner, but only if the mortgage is for a primary residence and the lender agrees.

These timelines are strict, but they’re not set in stone. If you can show a strong repayment history during the bankruptcy, some lenders might approve you earlier. Keep all payment records and be ready to share them when you talk to a loan officer.

Rebuilding Credit for FHA Approval

Your credit score needs to be at least 580 to qualify with a 3.5% down payment. If you fall below that, you’ll need a 10% down payment and a stronger credit profile. Aim to keep balances low, pay every bill on time, and avoid new debt while you’re rebuilding.

Getting a secured credit card or a small credit‑builder loan can add positive items to your credit report. Use the credit responsibly for a few months, then pay it off in full. The more on‑time payments you have, the faster your score will climb.

When you’re ready to apply, gather every document that shows your financial stability: tax returns, pay stubs, bank statements, and proof of assets. Lenders will look at your entire picture, not just the bankruptcy filing.

Remember, the FHA is designed to help borrowers who might struggle with conventional loans. As long as you meet the waiting period, keep your credit moving upward, and can show you can handle a mortgage payment, you have a solid chance.

Before you start, talk to a mortgage broker who knows FHA guidelines. They can tell you exactly how long you need to wait, what paperwork to collect, and which lenders are most flexible. A good broker can also help you avoid common pitfalls, like applying too early or missing a required document.

Bottom line: bankruptcy doesn’t close the door on an FHA loan. Follow the waiting periods, rebuild your credit, and work with an experienced lender. With patience and the right steps, you can get back on the path to homeownership.