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My parents recently went bankrupt. They were able to keep their house but, they have a construction loan which is past due and they are currently paying really high interest only payments. How can they get a mortgage to pay off the construction loan? If it is impossible for them to get a loan, what are the options for their children obtaining a loan? Any help is greatly appreciated.




As your parents have recently gone bankrupt, it won't be possible for them to qualify for a mortgage. depending upon the type of bankruptcy they filed, your parents will have to wait for 2-4 years in order to qualify for a conventional mortgage.

If you have a good credit score and stable employment situation, then you will be able to get a mortgage on your parents' behalf. This loan will help them pay off the mortgage. However, as the mortgage will be in your name, you will be liable for paying off the dues on time.

Sub: #1 posted on Thu, 01/06/2011 - 22:15

Anna Sweeting Anna Sweeting

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Hi!
Welcome to the forums!
It depends on the type of bankruptcy they have filed. If your parents have filed Chapter 13 bankruptcy, then they can apply for a FHA loan after 1 year. They can apply for conventional loans after 2 years of filing bankruptcy. In case of Chapter 7 bankruptcy, your parents can apply for FHA loans after 2 years. As far as conventional loans are concerned, they can apply for them after 4 years of filing bankruptcy. However, your parents will find it easier to qualify for the loans if they take steps to rebuild their credit within this time period.

Sub: #2 posted on Sun, 01/09/2011 - 21:37

Good Nelly Good Nelly
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