Second Chances: Can I Get a Mortgage after a Foreclosure or Chapter 7?

A couple of years ago, things got a pretty tough and you ended up foreclosing on your home. You weren’t the only one. So, does that mean homeownership isn’t an option for you anymore? Not quite. It’s going to take time and work, but you absolutely can own a home again one day.

Here's what you can do

Buying a home after foreclosure and Chapter 7 

A foreclosure and a Chapter 7 bankruptcy can have similar effects on your ability to buy a home in the future. However, there are some minor differences between the two. 

Credit score: Both will cause a dip in your credit score, but bankruptcy is will normally have a bigger negative impact. 

Credit report: Both will stay on your report for awhile, but the bankruptcy will stick around longer. You can expect the foreclosure to stay 7 years and the bankruptcy to stay 10. 

Now that some time is passed and you're ready to buy a home, what are your options? 


There’s no way around this one. You’re going to have to wait at least a couple of years after your foreclosure before you can buy another home. How long? That depends on the type of loan you want.

  • FHA Loan: usually three years
  • VA Loan: usually two years
  • Conventional Loan: usually seven years

Waiting might seem excruciating if you really want to be a homeowner, but the good news is there are some things you can be doing during that time period that will help increase your chances of owning a home in the future. 

Build Credit

Your credit took a huge hit when you foreclosed on your home. The foreclosure will stay on the report for seven years, but if you’re paying all of your other debts on time, your score can start to improve within two years. So make sure you know what your credit score is and do everything you can to improve it.

Get Pre-Approval

Most homebuyers are going to get pre-approved before they contact a real estate agent. But it’s going to be even more important if you’ve had a foreclosure. Once you’re pre-approved your real estate agent--and you--can be more confident that you’re able to get a mortgage.

Make a plan

No one wants to see you foreclose on a second home. Make sure you have a solid plan for how you’ll manage your expenses and what you’ll do in case of an emergency (like getting laid off).

So, start your plan. Start your savings. And start working on your credit.