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Jumbo Loan after Chapter 7 Bankruptcy
I filed bankruptcy and got it discharged two years ago. I know different loan programs have waiting period after Chapter 7 Bankruptcy. I worked hard in re-establishing my credit and am successful with my job as a digital media marketing consultant. I can put $300,000 down payment on a home purchase and want to buy a $1.2 million dollar luxury home. I am worried about qualifying for a jumbo loan after Chapter 7 Bankruptcy due to the waiting period requirements. How many years will you have to wait after filing Chapter 7 Bankruptcy for Jumbo loan?
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1 Reply
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Once a borrower has been discharged from Chapter 7 Bankruptcy, the waiting period for them to qualify for a jumbo loan can differ. However, most lenders typically impose a longer waiting period for jumbo loans than for conventional loans since the risks are greater to them. This is what you would usually get:
Typical Waiting Period for Jumbo Loans
- 4 to 7 Years: In most cases, the waiting period imposed on most borrowers who have had their Bankruptcy discharge under Chapter 7 before applying for the jumbo loan is between 4 and 7 years.
- 3 Years (Rare Cases): Some lenders might approve you for a jumbo loan if you wait just about three years after filing a bankruptcy discharge.
- However, you will need strong credit, significant proof of cash reserves, and a regular job with some stability.
Factors That Can Influence Approval
- Credit Score: Reestablishing strong credit is crucial.
- Lenders generally expect a minimum score of 700 and above.
Down Payment:
- Your down payment of $300,000, which represents 25% of the total purchase price of $1.2 million, is a good aspect to your advantage.
- It helps negotiate the length of the waiting period or the loan status.
Income and Employment
- As you stated in your digital media marketing consultant position, your income is stable and high, accelerating your eligibility for jumbo loans soon.
Steps to Improve Your Chances
- Shop Around: Don’t lower your standards for one particular lender.
- This is because some lenders have weaknesses that others do not.
- Other lenders may be accommodating in light of your positive financial standing.
Consider Alternative Loan Products:
- However, you may take up a non-QM loan.
- There is no waiting period after bankruptcy for non-QM loans.
- Mortgage underwriters are different in that they want to make the deal work.
- Its waiting periods for bankruptcy and low credit scores are lenient on non-QM Jumbo Loans.
- A 10% to 30% down payment is required on non-QM jumbo loans.
- There are dozens of non-QM jumbo loan programs, such as bank statement loans, DSCR loans, no-doc loans, asset-depletion loans, P and L Statement Jumbo Loans, stated income loans, and dozens of other creative funding products.
Please consult with a Mortgage Broker: It will be difficult to find lenders after bankruptcy, but a jumbo loan extension broker may know such lenders.
Though it is common to wait for around 4 – 7 years after Chapter 7 Bankruptcy Bankruptcy before applying for a jumbo loan, given your deep concerns about fast filing this loan level, you may even qualify faster if good deals are found.