Duane Buziak walks you through the steps to get a mortgage after Chapter 7 using an FHA purchase loan, from confirming your discharge date to closing day. You do not have to wait out the long timelines that apply to some other programs, and you can plan the path in order. Before you start, gather your bankruptcy discharge papers, recent credit reports, and records of your last two years of work history. Rules and figures below were checked against HUD sources as of October 2026, and you should confirm them again before you apply.
Step 1: Confirm Your Discharge Date and the FHA Waiting Period
FHA measures the Chapter 7 waiting period from the discharge date, not the date you filed. Under HUD Handbook 4000.1, the general requirement is two years from discharge, counted to the date the FHA case number is assigned. Many borrowers lose months because they count from the filing date, which is usually several months earlier.
Do not rely on memory. Find the date in one of these places:
- Your discharge order (Form B18), which the court mailed or e-served to you.
- Your attorney’s closing file.
- The court docket, available through PACER at pacer.gov, where the discharge entry carries a date.
Write down the discharge date, then add two years. That is the earliest date the FHA case number can be assigned under the standard rule.
HUD does allow a shorter period in limited cases. With documented extenuating circumstances, such as a job loss or serious illness outside your control, and at least 12 months of re-established good credit, a lender may be able to proceed sooner. Treat this as an exception that requires paperwork and lender acceptance, not a plan. Some lenders also add their own stricter rules, which is covered in Step 6.
One mistake to avoid: assuming a four-year conventional-style wait applies here. It does not. Read the current language yourself in HUD Handbook 4000.1 at hud.gov, since handbook text is updated from time to time.
Step 2: Pull Your Credit Reports and Verify Every Account Reports Correctly
Request your reports from annualcreditreport.com, the federal site referenced by the Consumer Financial Protection Bureau. Pull all three bureaus, because they do not always match.
Go through each account that was included in the bankruptcy. Every one should show as discharged in bankruptcy with a zero balance. Look for these problems:
- Accounts still reporting a balance or past-due amount after discharge.
- Late payments dated after the discharge date on a debt that was discharged.
- Duplicate entries, where a collection agency reports a debt the original creditor also lists.
- Debts you reaffirmed, which stay your obligation, must be paid on time, and will be counted in underwriting.
If something is wrong, dispute it with the bureau in writing and attach your discharge order. The CFPB explains the dispute process on its site. Bureaus generally have 30 days to investigate, so start early. Errors left uncorrected can lower your score or trigger extra underwriting questions.
A bankruptcy can remain on a credit report for up to 10 years under the Fair Credit Reporting Act. That is a reporting rule, separate from FHA eligibility, which is why you can qualify well before the entry drops off.
Duane Buziak can review your file using NoTouch Credit Pull, a soft pull with no hard inquiry. Some other lenders require a hard pull to pre-qualify, so ask before you authorize anything with any company.
Step 3: Rebuild Credit Until You Meet the FHA Score Tiers
FHA ties your minimum down payment to your credit score. Per HUD Handbook 4000.1 (verified October 2026 at hud.gov):
- 580 and above: eligible for maximum financing, which means 3.5% down.
- 500 to 579: eligible only with at least 10% down.
Lenders may set higher minimums, called overlays. A lender that wants 620 or 640 is stricter than HUD, not following a different federal rule. This is one reason borrowers get different answers from different companies.
After discharge, HUD expects to see re-established good credit and no new late payments. Underwriters pay the most attention to housing and installment accounts. To build that record:
- Open one or two accounts, such as a secured card or a credit-builder loan, if you have none open.
- Keep card balances below 30% of each limit, and lower is better.
- Set every bill to autopay at least the minimum.
- Do not open several accounts at once, since many new inquiries and accounts can hurt a score.
Rent deserves special care. Expect scrutiny of your last 12 months of housing payments. Pay by check, bank transfer, or another traceable method, and keep proof. If you rent from a private landlord, a signed lease and matching bank records help show the pattern. Late rent after a discharge is the kind of mark that can stall an otherwise solid file.
Step 4: Document Income, Work History, and Your Debt-to-Income Ratio
Underwriters want a clear, repeatable picture of your earnings. Gather these before you apply:
- Two years of W-2s and tax returns (self-employed borrowers should expect to provide full returns with schedules).
- Pay stubs covering the most recent 30 days.
- Two months of bank statements for every account that will show funds.
Debt-to-income ratio (DTI) compares your monthly debts to your gross monthly income. FHA guidance commonly references 31% for housing costs alone (front-end) and 43% for all debts combined (back-end) as benchmarks. Higher ratios can be approved through automated underwriting when compensating factors exist, such as steady employment or cash reserves. Handbook figures change, so verify the current numbers at hud.gov, and ask your loan professional how your own file is likely to be evaluated.
Prepare a short letter explaining the bankruptcy. Underwriters often request one. Keep it factual: what happened (job loss, medical bills, divorce), when, and what you have done since to stabilize. A page is plenty. Avoid blame or long stories; the goal is to show the cause was specific and is behind you.
One mistake to avoid: large cash deposits that you cannot document, especially in the 60 days before you apply. Underwriters ask for a paper trail on any sizable deposit, and cash has none. Deposit money as you receive it, and keep the source records.
Step 5: Save the Down Payment and Plan Your Real Costs
At 3.5% down, a $350,000 home in the Richmond area needs $12,250 for the down payment. Gift funds from a family member are allowed on FHA loans with a signed gift letter stating the money does not need to be repaid. Closing costs are separate.
The following is an illustration, not a quote. Suppose you buy a $350,000 home in Henrico County with 3.5% down. The base loan is $337,750. FHA charges an upfront mortgage insurance premium (UFMIP) of 1.75%, which is $5,911 and can be financed into the loan, making the total about $343,661.
- Annual MIP: 0.55% is the rate for the common tier (30-year term, loan amount at or below the base limit, above 95% loan-to-value), per HUD Mortgagee Letter 2023-05. That is about $1,890 a year, or roughly $157 a month. Other tiers carry different rates.
- Property tax: Henrico County’s rate is $0.85 per $100 of assessed value (verified October 2026 at henrico.us). On $350,000, that is $2,975 a year, or about $248 a month.
- Homeowners insurance: get a real quote, since it varies by home and coverage.
Add principal and interest at your quoted rate to these monthly figures to see your true payment. Because the rate changes daily, this illustration leaves it out on purpose.
On closing costs, FHA permits sellers to contribute up to 6% of the price toward them. Negotiated well, that can create no-out-of-pocket closing options for some buyers, depending on the contract and the market.
Finally, check that your target price fits the county’s FHA limit. The 2026 national floor for a one-unit home is $541,287 (HUD Mortgagee Letter 2025-23). Look up your county at hud.gov, since high-cost areas are higher.
Step 6: Get Pre-Approved with Duane Buziak and Shop Homes Within Limits
Pre-approval means a loan professional reviews your actual documents, not just a self-reported score. Submit what you gathered in Steps 2 through 4, and you will get a letter stating a price range you can shop in.
This is where working through a broker matters after a bankruptcy. Duane Buziak is a mortgage broker, not a direct lender, with access to 500+ wholesale lenders. Because overlays differ so much, he can look for lenders whose guidelines fit a post-Chapter 7 file instead of leaving you with a single company’s rules. His Dare to Compare challenge lets you put a competing quote next to his.
When you talk to any lender, ask directly:
- What is your minimum credit score for an FHA loan after Chapter 7?
- Do you require more than HUD’s two-year wait?
- Do you pull credit as a hard inquiry to pre-qualify?
- What are your DTI limits for a post-bankruptcy borrower?
Large national companies such as Rocket and Movement offer FHA loans too. Their current overlays and credit practices can change, so ask them the same questions and get the answers in writing instead of assuming.
Use your letter to set a price range with room under the county FHA limit, then plan for taxes, MIP, and insurance as shown in Step 5. Duane Buziak is based in Virginia and is licensed in VA, FL, TN, GA, and DC. Virginia is his primary market.
Step 7: Move from Contract to Closing Without Surprises
Once you have an accepted offer, the process runs in a set order:
- Offer and contract: your agent writes it with FHA financing and any seller concession terms.
- FHA appraisal: the appraiser values the home and checks it against HUD’s minimum property standards for condition and safety, such as roof, heating, and peeling paint on older homes.
- Underwriting: the file is reviewed and conditions are issued.
- Clearing conditions: you supply what underwriting requests.
- Closing Disclosure: you receive it at least three business days before closing and compare it to your estimate.
The FHA case number must be assigned after the waiting period is satisfied. If you are close to your two-year date, do not let a contract outrun the calendar, because a case number assigned too early can create a problem. Confirm timing with your loan professional before you make an offer.
Until the loan funds, avoid new debt, job changes, and closing any accounts. Lenders often recheck credit and employment right before closing, and a new car loan or a switch to a different pay structure can undo an approval.
Answer underwriting conditions within 24 to 48 hours. Keep your discharge papers, bankruptcy explanation letter, and bank statements in one folder, since requests often repeat. Fast replies keep your closing date from slipping.
Your Next Move: Recheck Your Dates and Scores, Then Talk to a Broker
Before anything else, recheck your discharge date and your current scores. If you are inside the two-year window, you can still use the time to clean up reports and build a payment record. If you are past it, you may be ready to apply now.
Ready to take the first step toward homeownership with an FHA loan tailored to your needs? Schedule your free consultation today and discover how our award-winning team can help you navigate the path to your new home with competitive rates and expert guidance. FHA Mortgages by Duane Buziak offers a NoTouch Credit Pull (a soft pull with no hard inquiry), access to 500+ wholesale lenders, a Dare to Compare pricing challenge, and no-out-of-pocket closing options where the contract allows. Call 804-212-8663 or visit 4860 Cox Rd, Glen Allen, VA 23060. Coast2Coast Mortgage LLC, NMLS #1110647, is licensed in VA, FL, TN, GA, and DC.
