Does a Past Bankruptcy, Forbearance, or a Late Payment Block You From Qualifying for a New Mortgage?
Not permanently. A bankruptcy, a loan modification, a forbearance or a recent late payment each comes with its own waiting period or conditions, and they differ by program (conventional, FHA or VA) and by whether you want a purchase, a regular refinance or cash out. A mortgage that's past due right now, though, generally has to be brought current first.
Last updated September 29, 2026How long after bankruptcy can I qualify?
It depends on the program and the chapter:
- Conventional (Fannie Mae): 4 years after a Chapter 7 discharge or dismissal, or 2 years with documented extenuating circumstances. After Chapter 13, 2 years from discharge or 4 from dismissal.
- FHA: generally 2 years after a Chapter 7 discharge. During Chapter 13, you may qualify after 12 months of on-time plan payments with the court's permission.
- VA: generally 2 years after a Chapter 7 discharge. During Chapter 13, you may qualify after 12 months of on-time plan payments with the trustee's or court's approval.
The credit report is a separate clock: a Chapter 7 can stay on your report up to 10 years from filing and a Chapter 13 about 7, usually longer than the loan waiting periods.
What about late payments, forbearance or a modification?
Lenders look closely at the last 12 months of mortgage payments, especially for a cash-out refinance, and rules vary by program. After a forbearance or modification, lenders generally want the loan current and a record of on-time payments since; how many depends on the program and the lender. VA doesn't publish a set lookback for late payments before a cash-out, so lenders set their own.
How long before I can take cash out?
Cash-out refinances also have ownership seasoning rules:
- Conventional (Fannie Mae): at least six months on title, and a first mortgage being paid off at least 12 months old.
- FHA: 12 months of owning and living in the home, with on-time payments over that period.
- VA loan into a VA cash-out: the later of 210 days after the first payment was due or six payments made.
It depends on your situation:
- Your bankruptcy was dismissed, not discharged: conventional loans measure the wait from the dismissal date.
- You bought your home with cash: Fannie Mae's delayed financing exception can let you take cash out sooner; it generally doesn't apply to FHA.
- You had a late payment eight months ago: it's still inside the 12-month window lenders review for a cash-out.
- Your mortgage is past due now: bring it current, or resolve it through forbearance or a modification, before applying.
| Conventional after Chapter 7 | 4 years, or 2 with extenuating circumstances |
|---|---|
| FHA after Chapter 7 | 2 years |
| VA after Chapter 7 | 2 years |
| FHA or VA during Chapter 13 | Possible after 12 months of on-time plan payments, with approval |
| Conventional cash-out seasoning | Six months on title; loan being paid off at least 12 months old |
| FHA cash-out seasoning | 12 months owned and lived in |
| Bankruptcy on your credit report | Up to 10 years (Chapter 7); about 7 (Chapter 13) |
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Sources
- https://homebuyer.com/guidelines/fannie-mae/cash-out-refinance-transactions-b2-1-3-03
- https://homebuyer.com/guidelines/freddie-mac/cash-out-refinance-mortgages-4301-5
- https://www.lower.com/mortgages/cash-out-refinance/fha-vs-conventional-cash-out-refinance
- https://www.lower.com/mortgages/fha-loan/how-soon-can-you-refinance-an-fha-loan
- https://valoannetwork.com/va-loans/cash-out-refinance/
- https://www.thefederalsavingsbank.com/Blog/veterans-affairs-va-cash-out-refinance-after-buying-a-home-understanding-seasoning-and-timing/
- https://finexplained.com/glossary/delayed-financing-exception/
- https://www.amerisave.com/glossary/delayed-financing-what-it-means-for-home-buyers-in
- https://homebuyer.com/guidelines/fannie-mae/significant-derogatory-credit-events-waiting-periods-and-re-establishing-credit-b3-5-3-07
- https://shiningstarfunding.com/conventional-loan/conventional-loan-after-bankruptcy/waiting-period-for-a-conventional-loan-after-bankruptcy/
- https://www.neighborsbank.com/learn/fha-loan-after-bankruptcy/
- https://www.peoplesbankmtg.com/the-complete-guide-to-fha-bankruptcy-waiting-periods/
- https://www.thecreditpeople.com/bankruptcy/conventional-loan-after-chapter-7-whats-the-wait
- https://valoannetwork.com/va-loan-after-chapter-7-bankruptcy/
- https://www.thecreditpeople.com/bankruptcy/can-i-get-a-va-home-loan-after-chapter-7
- https://hurstlawfirm.com/how-long-does-chapter-7-bankruptcy-affect-credit/
- https://www.kfoxlaw.com/post/chapter-7-bankruptcy-stays-on-your-credit-report-for-how-long
- https://myndm.com/downloads/products/fha/FHA-Matrix.pdf
- https://www.fha.com/fha_article?id=304
- https://homebuyer.com/guidelines/fannie-mae/previous-mortgage-payment-history-b3-5-3-03
- https://www.zeitro.com/faqs/mortgage-late-payment
- https://servicing-guide.fanniemae.com/svc/d2-3.2-06/fannie-mae-flex-modification
- https://www.austinmcknight.com/resources/forbearance-loss-mitigation-recovery-by-loan-program
- https://vamortgagehub.com/2017-va-loan-guidelines/
- https://valoannetwork.com/va-loan-late-payments/
- https://selling-guide.fanniemae.com/sel/b2-1.3-03/cash-out-refinance-transactions
- https://www.hud.gov/sites/dfiles/OCHCO/documents/40001-hsgh-update15-052024.pdf
Sourced from licensed loan officers and brokers in the FreeRateUpdate network.
Educational information only, not individualized financial or legal advice. Program details and rates change; verify current terms with a licensed loan officer before making a decision.