If an FHA-insured loan was included in the bankruptcy estate, the borrower is not eligible for another FHA insured loan for three years from the date of the discharge.
On a HECM used for a refinance: There is no seasoning or credit score requirements if you had a Chapter 7 bankruptcy, unless an FHA insured mortgage was included in the BK within the past 3 years. We do require that the BK be dismissed or discharged. To avoid a Life Expectancy Set-Aside (LESA), it’s possible extenuating circumstances may be required depending on the length of time since the bankruptcy has passed.
On a HECM used for a purchase: The bankruptcy must be dismissed or discharged for at least two years prior to obtaining the FHA Case Number Assignment; or If less than two years but not less than 12 months since the discharge date, a HECM may be acceptable if the borrower can provide documentation showing that the bankruptcy was caused by extenuating circumstance beyond the borrower’s control, and the borrower has since established the ability to manage his or her financial affairs in a responsible manner.