Buying A Home In An Active Chapter 13 Bankruptcy With As Low As 3.5% Down

Most people in an active Chapter 13 bankruptcy have been told the same thing over and over. “You have to wait until your bankruptcy is discharged before you can get a mortgage.”

That is not always true.

We have a Chapter 13 bankruptcy mortgage option that can go as low as 3.5% down for buyers who are still in an active repayment plan. This is available in Oregon, Washington, and Colorado, and it is a true needle in a haystack in today’s lending world.

A real example of how this works

Here is the kind of story we see.

Someone filed a Chapter 13 bankruptcy a couple of years ago. Life had thrown some curveballs, they got a plan set up, and they have been making that payment every month like clockwork. In the meantime rents went up, kids got bigger, and they are tired of feeling stuck.

They call around and every lender tells them no. They are in an active Chapter 13 so they think they have to sit on the sidelines until it is discharged.

With our Chapter 13 bankruptcy mortgage option we can look at it differently.

• At least 12 months of on time Chapter 13 plan payments
• Standard income and credit underwriting guidelines
• Trustee approval when required
• Down payment as low as 3.5%

If those pieces are in place, we can run real numbers and see if buying now makes sense instead of waiting several more years.

Why this Chapter 13 mortgage option is so rare

Most lenders want your Chapter 13 bankruptcy to be completely discharged, then they want to wait again after that before they will touch a mortgage. By the time you clear all of that, home prices and rents have usually climbed even higher.

Because we are an independent mortgage broker with a wide range of programs, we can work with bankruptcy friendly investors that many banks and call center lenders do not have access to. That is how we are able to offer a true active Chapter 13 bankruptcy mortgage with as low as 3.5% down in Oregon, Washington, and Colorado.

Thinking about buying in Chapter 13

If you are in an active Chapter 13 bankruptcy and want to buy a home, the best first step is simple.

• Tell us how long you have been in your Chapter 13
• Confirm you have at least 12 months of on time plan payments
• Share your rough income, debts, and where you want to buy

From there we can run a Chapter 13 bankruptcy mortgage scenario for you and see if this as low as 3.5% down option is a fit, or if there is another route that makes more sense.

You do not have to guess or assume you are stuck. If you are in Oregon, Washington, or Colorado and you are in an active Chapter 13 bankruptcy but want to buy a home, reach out and we can walk through your options together.

Matt Boytz
Direct: 541-359-7212
Office: 541-972-8616
NMLS 1294957
NMLS 2552455
Matt@BendMortgageBrokers.com
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www.BendMortgageBrokers.com