Underwriting, translated
Waiting periods after bankruptcy or foreclosure, every program in one chart.
Chapter 7, Chapter 13, foreclosure, deed-in-lieu, short sale: each one starts a different clock with each loan program. We pulled the actual numbers from the agency guidelines and put them side by side.
In short
Key takeaways
- Every clock starts at the discharge, dismissal, or completion date, never the filing date.
- Chapter 13 done right is the fastest agency path: FHA, VA, and USDA can approve you 12 months into the plan with court permission, and Fannie Mae waits only 2 years after discharge. The full playbook is in mortgage after Chapter 13.
- If your mortgage was discharged in the bankruptcy, Fannie Mae counts the wait from the discharge date, not from a foreclosure the bank finished years later. Documentation makes or breaks this.
- Non-QM lenders price seasoning in tiers, commonly 12, 24, and 36 months from the event, at larger down payments and higher cost than agency loans.
Written and reviewed by the Intel Loans, Inc. lending team · NMLS #2858705Updated July 2026
The master chart
Waiting periods by credit event and loan program
Verified July 2026 against Fannie Mae Selling Guide B3-5.3-07, FHA Handbook 4000.1 (II.A.4.b.iii), the VA Lender's Handbook chapter 4, and USDA HB-1-3555 chapter 10. Freddie Mac's periods track Fannie's for these events.
| Credit event | Conventional (Fannie Mae) | FHA | VA | USDA | Non-QM |
|---|---|---|---|---|---|
| Chapter 7 bankruptcy | 4 years from discharge or dismissal | 2 years from discharge | 2 years from discharge | 3 years from discharge | 0 to 2 years, by program |
| Chapter 13, discharged | 2 years from discharge | 12 months into the plan with court permission, or after discharge | 12 months of on-time plan payments plus trustee approval | 12 months of on-time plan payments plus trustee approval | 0 to 2 years, by program |
| Chapter 13, dismissed | 4 years from dismissal | Underwriter judgment; no fixed period | Underwriter judgment; no fixed period | Treated as significant derogatory within 36 months | 0 to 2 years, by program |
| Foreclosure | 7 years from completion | 3 years from the date the deed left your name | 2 years from completion | 3 years from completion | 0 to 2 years, by program |
| Deed-in-lieu of foreclosure | 4 years from completion | 3 years, treated like a foreclosure | 2 years, treated like a foreclosure | 3 years from completion | 0 to 2 years, by program |
| Short sale (preforeclosure) | 4 years from completion | 3 years; possibly none if you were current for the 12 months before the sale | Commonly 2 years; no fixed rule in the handbook | 3 years from completion | 0 to 2 years, by program |
| Mortgage charge-off | 4 years | Underwriter judgment | Underwriter judgment | Underwriter judgment | 0 to 2 years, by program |
| Multiple bankruptcies (within 7 years) | 5 years from the most recent discharge or dismissal | Standard period per event | Standard period per event | Standard period per event | Case by case |
FHA measures to the date your new FHA case number is assigned; Fannie Mae measures to the disbursement date of the new loan. The FHA short-sale exception requires that your mortgage and installment payments were current for the 12 months before the sale and that you were not simply walking away from a falling market. Non-QM seasoning varies by lender and tier; "0 years" programs exist but carry the largest down-payment and reserve requirements.
When the clock actually starts
More files die on the start date than on the waiting period itself. Three different dates matter, and borrowers regularly mix them up:
- Discharge date is the day the court wipes the debts. It is on the discharge order, usually 3 to 5 months after filing a Chapter 7 and 3 to 5 years after filing a Chapter 13. This is the date FHA, VA, USDA, and Fannie Mae all use for a completed bankruptcy.
- Dismissal date is the day a case ends without relief. Fannie Mae penalizes it: a dismissed Chapter 13 waits 4 years against 2 for a discharged one, because a dismissal usually means the plan failed.
- Completion date governs property events. For a foreclosure it is the day the deed transferred out of your name (the sheriff's sale or certificate of title in Florida), not the day the lender filed the case. For a short sale it is the closing date.
Bring your discharge order, your schedules (to show the mortgage was listed), and the recorded foreclosure deed to any lender conversation. We ask for them in the first call because the dates decide which programs are even on the table. If you are working through this now, our Chapter 7 rebuild guide walks the two-to-four year window month by month.
Extenuating circumstances: what actually qualifies
Fannie Mae defines extenuating circumstances as nonrecurring events beyond your control that caused a sudden, significant, and prolonged drop in income or a catastrophic jump in obligations. In practice that means a serious illness, the death of a wage earner, or a documented layoff. A market downturn, an investment that went bad, or plain overextension does not qualify, and FHA reads the exception even more narrowly than Fannie does.
The documentation burden is real. Underwriters expect a package, not a paragraph:
- A written letter of explanation connecting the event to the credit failure, with dates.
- Third-party proof of the event itself: medical records or bills, a death certificate, layoff or severance notices, insurance claims.
- Proof the damage was resolved and nonrecurring: new employment history, income restored, clean credit since.
| Event | Standard wait | With documented extenuating circumstances |
|---|---|---|
| Conventional: Chapter 7 | 4 years | 2 years |
| Conventional: Chapter 13 dismissal | 4 years | 2 years |
| Conventional: multiple bankruptcies | 5 years | 3 years |
| Conventional: foreclosure | 7 years | 3 years, with strings attached: LTV capped at the lesser of 90% or the program maximum, principal-residence purchases only, and limited cash-out refinances only |
| Conventional: deed-in-lieu or short sale | 4 years | 2 years |
| FHA: Chapter 7 | 2 years | 12 months minimum |
| FHA: foreclosure | 3 years | Case-by-case exception |
| USDA: Chapter 7 | 3 years | 12 months possible |
| VA: Chapter 7 or foreclosure | 2 years | 12 to 24 months if caused by events beyond your control |
Notice the conventional foreclosure row. Even with an approved exception, Fannie Mae caps the loan at 90% LTV or the program maximum, whichever is lower, restricts purchases to a principal residence, and blocks cash-out refinancing until the full 7 years pass. The exception opens the door; it does not remove the guardrails.
What "re-established credit" means to an underwriter
Surviving the waiting period is necessary, not sufficient. Fannie Mae requires that the file show traditional re-established credit: the waiting period met, an acceptable DU recommendation or the minimum score for a manual underwrite, and real tradelines. Thin files and nontraditional credit do not satisfy B3-5.3-07 after a derogatory event. FHA phrases it as a documented ability to manage your financial affairs responsibly.
What that looks like in a file: two or more open tradelines seasoned 12 to 24 months (a secured card and a small installment account are the standard rebuild tools), zero late payments after the event, no new collections, and a clean 12-month housing history, rent included. One 30-day late inside the rebuild window restarts the argument, if not the clock.
The shortcut
Non-QM lenders read the same history and shorten the sentence.
Portfolio and non-QM programs are not bound by agency seasoning. Most price it in tiers: 36 months from the event underwrites close to normal, 24 months costs more, 12 months more still, and a handful of programs will lend with the event barely behind you if the down payment is large enough, commonly 25% to 30% down with meaningful reserves. These are fully underwritten, ability-to-repay compliant loans; what changes is how recent history is priced, not whether you must qualify. The full program guide, tiers and bridge math included, is recent credit event loans.
The common play is a bridge: buy now on a non-QM loan, then refinance into an agency loan once your waiting period expires and the math favors it. Run that second leg through our refinance break-even calculator before you count on it.
Worked example
A Tampa couple, a March 2025 discharge, and a $350,000 target
A hypothetical example with the math shown. Say a Tampa couple's Chapter 7 was discharged March 2025, their credit has been clean since, and they want a $350,000 house. Here is their actual option map as of mid-2026:
| Program | Eligible from | Down payment on $350,000 | Wait from mid-2026 |
|---|---|---|---|
| Non-QM (portfolio programs) | Available now, subject to program seasoning tiers | $70,000 at 20% down (typical floor) | None |
| FHA | March 2027 | $12,250 at 3.5% down | About 8 months |
| VA (if eligible) | March 2027 | $0 down permitted by the program | About 8 months |
| USDA (eligible areas) | March 2028 | $0 down permitted by the program | About 20 months |
| Conventional | March 2029 | $17,500 at 5% down (3%-down programs exist with eligibility limits) | About 32 months |
The decision is concrete: buying today through a non-QM program takes roughly $70,000 down instead of $12,250, a difference of $57,750 in cash, in exchange for owning about eight months sooner and at a higher cost of borrowing. Waiting for the FHA window costs eight months of Tampa price movement and rent, but frees most of that cash for reserves and closing costs. There is no universal right answer; there is a right answer for a specific file, and it falls out of exactly this table. Down-payment percentages here are program guidelines as of mid-2026; the dollar figures are simple multiplication, and closing costs (Florida doc stamps included) come on top of every column.
What the shortcut costs: the honest trade-offs
Everything above the agency baseline is priced. Non-QM programs that accept short seasoning charge a rate premium over agency loans, and the premium grows as the event gets closer; that is the whole business model. Down payments start around 20% and climb toward 30% at the shortest tiers, reserve requirements of 6 to 12 months of payments are common, and investor-purpose non-QM loans routinely carry prepayment penalties in their first 3 to 5 years, which matters if your plan is to refinance into an agency loan the month your waiting period ends. FHA's early door has its own toll: upfront and annual mortgage insurance that stays on the loan under FHA's current MIP structure. None of this makes early buying wrong. It makes early buying a purchase decision with a visible price tag, and we will put that price in writing before you commit to anything.
Questions we actually get
Does the clock start when I file or when the case ends?
When the case ends. Every program measures from the discharge or dismissal date, never the filing date. A Chapter 7 that took five months to move through court starts its waiting period the day the judge signs the discharge order, so pull your discharge paperwork and work from that date.
Do these waiting periods apply to refinances too?
Yes. Fannie Mae's B3-5.3-07 waiting periods end on the disbursement date of the new loan, purchase or refinance. The one carve-out sits inside the conventional foreclosure exception: during years three through seven with extenuating circumstances, limited cash-out refinances are allowed but cash-out refinances are not.
My credit report shows the wrong foreclosure date. Which date controls?
The completion date in the public record controls, meaning the date the deed transferred out of your name, not the date the lender started the case or the date the tradeline was last updated. If the report is wrong, dispute it with the bureau and bring the recorded deed to your loan officer; underwriters can document around a bad tradeline date.
Can I buy a house while I am still in a Chapter 13 plan?
Sometimes. FHA, VA, and USDA all allow it after 12 months of on-time plan payments with written permission from the court or trustee, underwritten manually. Conventional does not allow it during the plan. Expect the new house payment to be tested against your plan payment and the trustee to ask how the down payment was saved.
What if my foreclosure happened after my bankruptcy discharged the mortgage?
Under Fannie Mae guidance, if you can document that the mortgage debt was discharged in the bankruptcy, the bankruptcy waiting period applies and runs from the discharge date, even if the bank did not complete the foreclosure until years later. Without that documentation, the longer of the two waiting periods applies. This one rule moves eligibility up by years for a lot of people.
Is a dismissal better than a discharge?
No, usually worse. A discharge means you completed the case and the debts were wiped; a dismissal means the case ended without relief, often because plan payments stopped. Fannie Mae waits 2 years after a Chapter 13 discharge but 4 years after a dismissal for exactly that reason.
Find out which clocks have already run out.
Send the dates and we'll come back with every program you qualify for today, the ones that open next, and what each costs. In writing, no hard credit pull.
This is not a commitment to lend or an offer of credit. All loan approvals are subject to credit review, underwriting, and property evaluation. Programs, terms, and conditions are subject to change without notice.
Intel Loans, Inc., NMLS #2858705. Licensed in Florida. Verify our licensing at nmlsconsumeraccess.org. Equal Housing Opportunity.
Waiting periods on this page summarize agency guidelines as of July 2026 (Fannie Mae Selling Guide B3-5.3-07, FHA Handbook 4000.1, VA Lender's Handbook, USDA HB-1-3555). Agencies revise guidelines without notice; individual lenders may apply stricter overlays. Confirm your specific dates and eligibility with a licensed loan officer.