Can I Get a Mortgage After Bankruptcy? Yes, You Can … Here’s How

You can get a mortgage after bankruptcy, and often sooner than you think. 

I ended my career as a mortgage broker when I created 7 Steps to a 720 Credit Score, which is a free credit-education program that is designed for people who have been through a bankruptcy. For many of my students, buying a home is one of their biggest goals. I’ve helped thousands make it happen, and we walk with them every step of the way.

Below are the most common questions I hear about how to qualify for a home loan after bankruptcy. These answers come from real conversations with real people and the credit strategies I’ve spent decades teaching.

Can I get a mortgage while I’m still in a Chapter 13 bankruptcy?

Yes, you can buy a home while you’re still in a Chapter 13 bankruptcy. Here’s how it usually works: If you’ve made at least 12 on-time payments to your bankruptcy trustee, you may be eligible to apply for a mortgage, even before your bankruptcy is officially discharged. The key word here is may, because there are a few other boxes you’ll need to check.

First, your credit score matters. Most lenders want to see a score of at least 580, but there are occasional programs that will go a little lower. The better your score, the better your interest rate, so it’s worth doing what you can to boost it during your repayment plan. (If you’re in Evergreen’s Credit Rebuilder Program, you’re probably already working on that.)

Second, you’ll need to get court approval. This is often the part that trips people up, not because it’s hard, but because they don’t realize it’s required. Your bankruptcy attorney can file a motion with the court explaining the loan terms and why this purchase makes financial sense for you. As long as you’ve been responsible with your plan payments and the new mortgage won’t throw your budget out of whack, courts will usually say yes.

The surprise for most people is that buying a home during bankruptcy is even on the table. They assume they have to wait until everything is done and discharged. But that’s not always the case.

We’ve seen clients close on homes while still in their Chapter 13 plan, families who thought they’d be stuck renting for years. If owning a home is part of your long-term plan, don’t write it off just because you’re in bankruptcy.

“How long do I have to wait to get a mortgage after a Chapter 7 bankruptcy?”

The waiting period to get a mortgage after a Chapter 7 bankruptcy depends on the type of loan you’re applying for:

• FHA and VA loans usually require a two-year wait from the date your bankruptcy is discharged.
• USDA loans typically have a three-year waiting period.
• Conventional loans (Fannie Mae or Freddie Mac) usually have a four-year waiting period, though it can be shortened in some circumstances

Lenders will look closely at how you’ve managed your finances since the bankruptcy. Rebuilding your credit score is key. That means making every payment on time, keeping credit card balances low, and establishing new, positive lines of credit.
If you have been through a bankruptcy, you can also get free enrollment in 7 Steps to a 720 Credit Score, which walks you through exactly how to rebuild your score the smart way. So while you wait, there’s plenty you can do to put yourself in a strong position for a future mortgage.

Press Play: Can You Buy a House After Chapter 7 Bankruptcy?

“Can I get a mortgage after bankruptcy?” Watch this video to learn the answer for Chapter 7 bankruptcy filers.

“What’s the minimum credit score I need to get a mortgage after bankruptcy?”

The minimum credit score you need to get a mortgage after bankruptcy depends on the type of loan and the lender’s specific guidelines. But in general, most borrowers will need a credit score of at least 580 to qualify for an FHA loan, the most common path to homeownership after bankruptcy.

Some lenders will go lower, but it gets harder. A score below 580 typically requires a larger down payment and comes with higher interest rates, making the loan more expensive over time. Once your score reaches 620 or higher, you open the door to better loan terms, including eligibility for conventional loans and down payment assistance programs.

Here’s a side-by-side comparison of the most common loan options and their credit score requirements:

Table 1: Can I get a mortgage after bankruptcy? 

Loan Type	Minimum Credit Score	Down Payment	Maximum Loan-to-Value (LTV)	Loan Amount Cap	Notes
FHA Loan	580	3.5%	96.5%	~$498,257 (standard); up to $1,149,825 (high-cost)	Mortgage insurance required; less credit-sensitive
VA Loan	Typically 620	None	100%	No official cap with full entitlement	No mortgage insurance; for eligible service members
USDA Loan	640–650	None	100%	No set cap; property/income restrictions apply	Only for rural areas; modest homes; income limits
Conventional	620	5% to 20%	Up to 97%	$806,500 (standard); up to $1,200,000 (high-cost)	Private mortgage insurance (PMI) required if under 20% down

Post-bankruptcy, your credit score becomes one of the biggest factors in how soon you can buy a home and how much of a loan you can be approved for. Most people assume they have to wait 7 to 10 years for their bankruptcy to fall off their credit report, but that’s a myth. What matters more is how quickly you start rebuilding. Credit scoring models weigh recent positive behavior more heavily than old negative marks.

If you take action immediately after discharge or confirmation (e.g., adding new credit, making payments on time, keeping balances low, etc.)  you can often reach 620 or higher in 12 to 24 months.

That means instead of waiting 7 years and then starting from scratch, you can be mortgage-ready in 1 to 2 years, even with a bankruptcy on your record. If you are worried about your credit score, a great place to start is with our free credit-education course, 7 Steps to a 720 Credit Score. 

“Is it really possible to buy a home with a 3.5% down payment?”

Yes, it’s really possible to buy a home with just a 3.5% down payment, and for many people coming out of financial hardship or bankruptcy, this can be a game-changer.

FHA loans are specifically designed to help borrowers with lower credit scores and smaller savings get into a home. The standard down payment for an FHA loan is 3.5%, which means that on a $300,000 home, you’d need about $10,500 upfront. That’s still a significant amount, but it’s far more manageable than the 10% to 20% required for conventional loans.

Here’s where it gets even more encouraging: if your credit score is 620 or higher, you may qualify for down payment assistance programs. These are usually second loans or grants offered by state or local housing agencies. In some cases, the second loan covers the entire 3.5% down payment … and sometimes even part of your closing costs. According to the Urban Institute, over 2,000 programs exist across the country, many of them specifically geared toward first-time buyers and people with modest incomes.

“What’s the first step to getting a mortgage after bankruptcy?”

The first step is plain and simple: Rebuild your credit score. No matter which type of bankruptcy you filed, the terms and type of your mortgage will be determined in large part by your credit score.

If you filed Chapter 13, the clock starts ticking while you’re still in your repayment plan. Most lenders want to see 12 consecutive on-time payments to the trustee before they’ll consider you for a mortgage. That means consistency matters. Make every payment on time, and avoid taking on new debt unless advised by your attorney or a lender familiar with post-bankruptcy lending.

If you filed Chapter 7, the typical waiting period for a mortgage is two years after discharge. But here’s the catch: if you wait until the two-year mark to start rebuilding, you might find yourself unprepared when it’s finally time to apply. Credit scores don’t magically improve just because time passes. You will need about 12 to 24 months to rebuild your score, assuming you follow the gameplan for achieving a high credit score. 

That’s why enrolling in a structured credit-rebuilding program like Seven Steps to a 720 Credit Score can make all the difference. This kind of step-by-step approach helps you add positive accounts, remove harmful errors, and build the kind of credit profile lenders want to see.

Once your score is moving in the right direction, you’ll want to connect with a mortgage lender who understands how to work with post-bankruptcy buyers. Professionals who specialize in working with borrowers after a bankruptcy can walk you through pre-approval, help you understand loan options, and determine what you qualify for based on your current credit and income.

The key is starting now … not waiting. With the right moves, you could be mortgage-ready much sooner than you think.

Related Articles:

“Pros and Cons of Filing Bankruptcy: What the Banks Don’t Want You to Know”

“What Bankruptcy Lawyers Won’t Tell You About the Process”

“If I File Bankruptcy, What Happens to My Car?”

FAQ: Can I raise my credit score to 720 after bankruptcy?

Yes, it’s absolutely possible to raise your credit score to 720 after a bankruptcy, and faster than you might think.

We’ve worked with thousands of people who assumed bankruptcy meant the end of their creditworthiness. But after enrolling in 7 Steps to a 720 Credit Score, many of them reached a 720 credit score in just 9 to 12 months. Most hit that milestone within 12 to 24 months. It’s not magic. It’s a matter of knowing how credit scoring works and taking the right steps at the right time.

The truth is, credit scores are forward-looking. They’re designed to measure how you’re handling credit now, not just what happened in the past. So even if your bankruptcy will stay on your report for 7 to 10 years, your score can recover much sooner.

The key is to start rebuilding right away. That means:

• Disputing inaccurate items on your credit report
• Opening new lines of credit and managing them responsibly
• Keeping balances low and payments on time
• Avoiding new financial missteps, like missed payments or unnecessary hard inquiries

Programs like 7 Steps to a 720 Credit Score exist to take the guesswork out of rebuilding. If you follow a proven plan and stay consistent, your past doesn’t have to define your financial future.

We’ve seen people buy homes, refinance cars, and qualify for low-interest credit cards long before their bankruptcy drops off their report. So yes, you can raise your score to 720 after bankruptcy. The earlier you start, the sooner you’ll get there.

FAQ: Why do I need to get my credit report reviewed for errors after a bankruptcy?

After a bankruptcy, you’ll need to review your credit report for errors because errors are more common than you might think. According to a study by the Federal Trade Commission, one in five Americans has at least one error on their credit report that could negatively affect their score. After bankruptcy, the odds go up. It’s not unusual to see accounts that were supposed to be marked discharged in bankruptcy still showing up as delinquent, overdue, or even in collections.

And those errors can be expensive. A single mistake can knock dozens of points off your score, which could delay your ability to qualify for a mortgage or increase the interest rate you’re offered.

Dan Friel, one of the mortgage bankers we work with, reviewed three credit reports with major errors just this morning. One report had a discharged account still reporting a balance. Another listed a late payment that never happened. These types of mistakes are easy to miss if you don’t know what to look for, but lenders will see them immediately.

That’s why our free credit-education program for people who have been through a bankruptcy offers free credit report reviews. We help you scan for the most common post-bankruptcy errors and walk you through the process of fixing them. In many cases, correcting just a few items can result in a quick and noticeable bump in your credit score.

If you’re planning to buy a home after bankruptcy, reviewing your credit report is one of the smartest and fastest ways to get started.

FAQ: What if I don’t think I’ll qualify for a mortgage. Should I still apply if I’ve been through a bankruptcy?

Yes, you should still apply. One of the biggest obstacles people face after bankruptcy is the belief that they’re disqualified before they even try. This mindset holds a lot of people back. 

We’ve seen time and again that people are often far more mortgage-ready than they realize.

Lenders don’t expect perfection. They’re looking for progress. If you’ve made consistent payments, begun rebuilding your credit, and addressed any major credit report errors, you may already meet the minimum requirements for a home loan. Even if you don’t meet all the qualifications today, applying can open the door to a clear plan. That’s where guidance from our lending partners comes in. We help you assess where you are and what steps will get you to the finish line.

Sometimes, the path to approval is shorter than you think. Most of our clients are surprised to hear that they can improve their credit score just 12 to 24 months after a bankruptcy. With the right actions (e.g., correcting credit report errors, adding positive accounts, and keeping your debt-to-income ratio low), you could become eligible within a matter of months.

Don’t make the mistake of counting yourself out before a lender has the chance to evaluate your real situation. You deserve the opportunity to get accurate feedback, especially if you’ve been working hard to rebuild. Instead of assuming you’ll be denied, take the step to apply. You might be closer than you think, and even if you’re not quite ready, the process will show you exactly how to get there.

FAQ: Can I get a mortgage with lower interest if my credit is better?

Yes. A better credit score almost always means better interest rates when it comes to mortgages. Lenders use credit scores to decide how likely you are to repay your loan, and they offer the best terms to those with the strongest scores.

Even small changes to your credit score can have a big impact. For example, someone with a 620 score might qualify for a mortgage, but their rate could be significantly higher than someone with a 700. On a $300,000 loan, that difference could add up to tens of thousands of dollars in extra interest over the life of the loan.

You don’t need perfect credit to get a good deal. Moving your score from the low 600s into the high 600s or 700s can unlock better terms. These include not only lower rates, but also reduced mortgage insurance costs and better loan options.

This is one of the reasons we emphasize rebuilding your credit before applying. A little effort now can save you a lot of money later. Whether you’re still in a Chapter 13 plan or recently discharged from Chapter 7, your credit decisions today can help you qualify for more favorable terms when the time comes to apply.

FAQ: What if I’m just starting to think about buying a home?

If you’re starting to think about homeownership, this is the perfect time to start taking action by talking to a lending professional and cleaning up your credit. Most people wait until they feel “ready,” but the best results come when you plan ahead. By getting started early, you give yourself room to clean up your credit, understand your budget, and prepare for the mortgage process without pressure.

We’ve worked with plenty of clients who reached out before they were ready to apply. That early conversation helped them avoid costly missteps and gave them a clear action plan. Things like correcting credit report errors, adding new credit accounts, and paying down small balances can take a few months to show results, so starting now means you’ll be better prepared later.

You don’t need to have everything figured out before reaching out. If you’re even thinking about buying a home in the next year or two, that’s the perfect time to talk to someone. We can help you understand where your credit stands, what loan programs might be a good fit, and how to begin.

We’ll also connect you with experienced lenders who know how to work with buyers coming out of bankruptcy. These lenders can walk you through the timing and requirements so you’re ready when the moment comes.

Planning early gives you more control and better choices. Even if buying still feels far off, taking small steps now will put you in a much stronger position when the time is right.

FAQ: How does Evergreen Financial Counseling help during this process?

Evergreen Financial Counseling is here to help you move forward after bankruptcy with confidence and clarity. We are a nonprofit, which means our focus is on education and support, not selling you a product or service.

We begin by enrolling you for free into a credit-education program specifically for people who have been through a bankruptcy. Then we review your credit report for errors that may be holding your score back. We’ve seen everything from debts that should have been discharged still showing balances, to incorrect late payments and duplicate accounts.

We also help you identify positive actions, like opening the right types of credit and managing balances wisely. These small changes, when done in the right order, can raise your score faster than you might expect.

When you’re ready to explore mortgage options, we connect you with trusted lenders who understand what it means to rebuild after bankruptcy. These lenders can help you figure out where you stand today and what you need to do to qualify in the future.

Throughout the process, you’ll have a team that’s rooting for you, guiding you, and answering your questions honestly. We don’t believe in shame or judgment. We believe in practical tools, clear plans, and the possibility of homeownership for people who have had setbacks.

And we do all this at no cost because we believe everyone deserves a real second chance.

FAQ: What types of loans are available after bankruptcy?

Several loan options are available to buyers after bankruptcy, and each has its own set of requirements. The best loan for you will depend on your credit score, income, down payment ability, and how much time has passed since your bankruptcy.

The most common option is the FHA loan, which is designed for people with limited savings or less-than-perfect credit. FHA loans require just 3.5% down and generally accept credit scores as low as 580. They are often the first path to homeownership for people coming out of a bankruptcy.

VA loans are another excellent option, but they are only available to veterans, active-duty service members, and eligible surviving spouses. These loans require no down payment, have no mortgage insurance, and are more flexible about credit history. Most lenders look for a credit score around 620.

USDA loans are for rural properties and also allow zero down payment. These loans have income limits and are typically available to moderate- and low-income buyers. Credit score requirements often start around 640.

Conventional loans are available to people with stronger credit and larger down payments. They usually require a credit score of 620 or higher and may come with stricter post-bankruptcy waiting periods. However, they can offer lower overall costs for well-qualified buyers.

Some buyers also qualify for down payment assistance programs, which can reduce or eliminate your out-of-pocket costs.

Each loan type has trade-offs, but all are worth exploring. We’ll connect you with a lending professional who can help you understand the options and figure out which one fits your situation best.

FAQ: How much cash do I need to buy a home post-bankruptcy?

It varies. The amount you need depends on several factors, including the type of loan, the cost of the home, your credit score, and whether you qualify for down payment assistance.

Let’s start with the basics. FHA loans are a popular option for post-bankruptcy buyers and require a 3.5% down payment. So, for a $300,000 home, you’d need $10,500 for the down payment.

But that doesn’t mean you’ll have to come up with that amount on your own. Many buyers qualify for down payment assistance programs that can lower the amount they need to bring to closing. In some cases, assistance can cover the full 3.5% and even help with closing costs.

We’ve had clients buy homes with as little as $500 out of pocket by combining an FHA loan with assistance from a local housing agency. Others have received grants or second loans that don’t have to be repaid right away.

On top of the down payment, you’ll need to plan for closing costs, which usually range from 2% to 5% of the purchase price. Some of this may also be covered by assistance programs or negotiated with the seller.

The total amount of cash you need can vary widely depending on where you live, your credit score, and the loan program you use. The best way to find out what you’ll need is to speak with a lender who understands post-bankruptcy homebuying. Your lending professional will help you review your options and identify programs that match your situation.

FAQ: How soon can I contact a mortgage banker after bankruptcy?

You can reach out to a mortgage banker right now. Whether you’re still in a Chapter 13 plan or recently completed a Chapter 7, it’s never too early to start the conversation.

For Chapter 13 filers, most lenders will consider your application after you’ve made 12 on-time payments to the bankruptcy trustee. You’ll also need permission from the court to take on a new mortgage. But you don’t have to wait for the bankruptcy to be fully discharged before you begin planning.

If you filed Chapter 7, most lenders require a two-year waiting period after your discharge date before they’ll approve a mortgage. That said, it’s smart to check in early so you know what’s expected and can work on rebuilding your credit during that time.

We’ve seen clients make the mistake of waiting too long. They assume they can’t qualify, so they don’t speak with a lender until their waiting period is over. By then, they’ve lost valuable time they could have used to fix credit report errors, build positive accounts, and prepare for a strong application.
Talking to a mortgage banker early can help you avoid delays, reduce stress, and give you a clear set of next steps.

FAQ: What success stories have you seen with clients buying after bankruptcy?

There are so many, but one that stands out came on Christmas Eve. A man who had filed Chapter 7 two years earlier called us from his new home. He was sitting in front of a Christmas tree, his kids were in the background, and he had just made his first mortgage payment. That payment was lower than what he had paid in rent for years.

He told us the house was proof that things had turned around. He had been through hard times, but now he had stability, ownership, and a reason to celebrate. (You can listen to the story in his words here.)

That story isn’t unique. We’ve helped people buy homes after job loss, divorce, medical bills, and every kind of financial hardship you can imagine. What they had in common wasn’t perfect credit or a big bank account: it was determination and a willingness to follow the steps.

We’ve worked with single parents, teachers, veterans, and small business owners who used bankruptcy as a reset, not a roadblock. Some reached homeownership within 12 months of discharge. Others needed more time. But every one of them proved that it’s possible.
If you’ve filed bankruptcy, you’re not disqualified from buying a home. With the right plan and the right support, your story can end with a front door and a new beginning. We see it happen all the time.