FHA Loan chapter 13 BK (heloc, property, bank, lender)

[Michelleron]

We had a chapter 13 BK that was discharged in 2012. Within the BK court documents there is a judgment from the courts dated 2010 to forgive the HELOC. The Bank didn't forgive the debt until 2012 when we were discharged from bankruptcy. Would this disqualify us for a FHA Loan? If so can you please provide me the Documentation?

FHA says heloc that was considered null and void upon the discharge of the bankruptcy and resulted in a cancellation of debt needs to have 3 years seasoning from the date it was discharged with the bankruptcy. So the borrowers would not qualify for an FHA loan. this is due to it being a Chapter 13 BK which is a reorganization of debt and fact they retained property through the BK and therefore we have to go off date debt was actually forgiven/cancelled which is when BK was discharged, not filed

[Pfhtex]

You need to apply with a lender and furnish all documents related to this situation, as well as paystubs and tax returns.

[Michelleron]

We have applied with a lender and everything else is good and we qualify for the loan except for this 1 snag.. His underwriter contacted HUD about our situation and HUD Says 3 years from when the Heloc was discharged in BK. HUD is supposedly treats Heloc the same as a Short sale. Since the HELOC was included in the BK shouldn't they be going from the BK discharge date and not off of the HELOC? I have searched HUD website for the supporting documents and cannot find anything pertaining to this.

[Pfhtex]

Yeah, but if your payment history was clean leading up to it, it can be a different story. I doubt anyone contacted HUD, they likely just said that. You need a more aggressive lender.