FHA vs VA vs Conventional vs Non-QM After Bankruptcy | Live Rate Comparison

Ready to buy a home after bankruptcy?
Join our livestream as we break down mortgage options for borrowers recovering from Chapter 7 or 13. We’ll cover FHA, VA, Conventional, and Non-QM loans, including wait times, credit rebuilding flexibility, and which programs may offer the best rates.

Learn how FHA and VA allow faster homeownership, Conventional can save money long-term, and Non-QM can help you buy sooner — sometimes in 0–12 months.

📲 Join us live — ask questions anytime!
🎥 Watch the full episode:
👉 Daily Mortgage Rates LIVE Video Podcast

Catch all the episodes of Daily Mortgage Rates LIVE at https://themortgagecalculator.com/Page/Daily-Mortgage-Rates-LIVE-Video-Podcast

Check out all episodes of Daily Mortgage Rates LIVE at https://themortgagecalculator.com/Page/Daily-Mortgage-Rates-LIVE-Video-Podcast

The Mortgage Calculator is a licensed Mortgage Lender (NMLS #2377459) that specializes in using technology to enable borrowers to access Conventional, FHA, VA, and USDA Programs, as well as thousands of Non-QM mortgage loan program variations using alternative income documentation!

Using The Mortgage Calculator proprietary technology, borrowers can instantly price and quote thousands of mortgage loan programs in just a few clicks. The Mortgage Calculator technology also enables borrowers to instantly complete a full loan application and upload documents to our AI powered software to get qualified in just minutes!

Our team of licensed Mortgage Loan Originators can assist our customers with Conventional, FHA, VA and USDA mortgages as well as access thousands of mortgage programs using Alternative Income Documentation such as Bank Statement Mortgages...

Transcript

Today's topic is going to be the different loan types we can do after our bankruptcy. Unfortunately, bankruptcies do happen. Credit issues do happen. We went over some other credit events, some housing history events, the other day. That was more for foreclosures and other housing history events. Today, we'll preview some options based on actual credit events for bankruptcies and some common options here. So let me go ahead and switch my screen, and we'll get started for today. And as we do every day, we first want to check out the general rate environment.

So, typically, the best indicator of rates overall is going to be the ten-year treasury, especially as we look at all kinds of different loan programs. Here at the mortgage calculator, we love to offer our non q m loans, commercial loans, and all kinds of different loan types. But overall, most loans will follow this general trajectory. So you see, in the last five days, we've had some general upward momentum here as we have a big Fed announcement coming up. And, today, it looks like we kinda peaked and are coming down.

So that's some great, but again, again, I always wanna put things into perspective. So if we pull this out to one year, we're still pretty much at one-year lows here. Hard to go up and down throughout the day. Hopefully, we get some news, some good news here from the Fed. But even if we don't, the markets are already pretty priced in and are generally let me scroll lower in general than they have been over the last year or so.

So definitely a great chance for everybody that are out there, looking for properties here. Let's go into our live rates here at the mortgage calculator. So let me go ahead and refresh this page just so we get the absolute latest rates, and we can go over sample scenario. So, as we do every day, our sample scenario is going to be a standard single-family home, 500,000 purchase price, a 300,000 loan amount bonds to 60% loan to value. And we use an estimated seven sixty credit score and 40% debt-to-income ratio.

So I just refreshed the page here. So we're going to get the absolute latest rates. Let's make sure it updates here. Since it is twelve noon eastern here, we do all of our partners, all of our banks, and investors, and lenders out there are updating their rates as we speak. Maybe one of them is frozen there.

Let me go ahead and move on to the example today. We'll back up when we get the latest rates. So for today's example, as we do every day, we're going to pull up a specific home. So we have this home we did for the last couple of shows. It is a good price there.

That way, we can always have a nice target that will work for all our different loan types when we compare across. And if we're looking to home and, unfortunately, our borrower has a credit event such as a bankruptcy, there are two options, but most of our standard options do have a little bit of a wait period. So first up, we'll look at our standard conventional, the most standard option people think of when they think of purchasing a primary home. And the most standard option here is 5% down. So that's what we use for this example.

And it's, you can see with 5% down, conventional requires four years of seasoning after a chapter seven bankruptcy and a two-year from charge, four years from business before a chapter 13. And we can offer our standard rates as low as 5.75, costing 2.5 discount points cost. And our rate here, par rate, is 6.49 in this example. So we can offer our standard conventional as long as we meet those seasoning requirements. However, many of our borrowers have a more recent event, so some look at.

FHA has a little more leniency as expected here. So, FHA, for our options using a 3.5% down payment on our typical request here. We have a two-year wait after a chapter seven and a one year in a chapter 13 with on-time payments. That is the soonest we can get into an FHA option. So that's actually a good option there, but I'm gonna show some QM options that may be, quicker.

And if our borrower is VA eligible, so definitely a great option for our VA eligible borrowers. There are some more lenient options here for our vets. And if we have a chapter seven, there's a two-year wait, pretty standard there. And in our chapter 13, we can go one year to the plan, your payment plan with trustee approval there. So definitely some unique options there, and they get more lenient.

But for many of our borrowers, those still don't work, are not eligible for VA, or they may be self-employed, not be able to do a conventional loan, of any type, and we need to use non-QM. So that's where we love to excel here at the mortgage later when we present our non-QM options. So the first option I found here, going to be our option for a 12 bankruptcy. I accidentally put the wrong down payment amount there. But typically, our non-QM loans, if we need to use full doc or any credit of income, we can go to 90% LTV with no PMI.

But with a credit event, in this example, I used a Chapter seven, just over twelve months ago. We have to lower the LTV. So instead of 90% LTV as the max, I was able to find some options at 85% LTV or 15% down payment. Sorry. That was a typo up there.

And our options here that we just pulled up today for our rate, 7.5, the lowest rate for 2.5 discount points and cost. And we have a par rate here for our borrowers, a fresh out of bankruptcy. 8.375 rate costing 0.3. That's for 15% down, and we're using our standard scenario there, that we always set up. With our full doc option, we can use bank statements.

Now in even more recent bankruptcy, so if they have a chapter seven, discharged just once month ago, we have this option here. And we have to lower the LTV. The lowest option I was able to find it so in this option, we're able to find 30% down payment, 70% loan to value, just one month out of a chapter seven. And we even have some pretty low-rate options because we're putting more down payment, a 6.875 rate, costing 2.5 discount points in cost. And our 7.75 rate in this option for zero points.

And we actually have a little bit of a lender credit there, $500 lender credit. And you see here, there's a 30% down option using the same exact setup. However, we were getting pricing with our one month out of bankruptcy. So now let's see if we got our rates. Yes.

So the page, refreshed here. All are updated here. So let's quickly go through our standard programs, our conventional primary. We already went over that for our b k option, but our standard five one eight seven five. Final APR is 6.1.

FHA, we already looked at that again, but our standard FHA comes in as low as 5.25% rates a day. All of the fees are included in the APR, 6.143 APR. Remember, FHA does require upfront and yearly mortgage insurance. And our VA options, again, we already looked at in general. Our VA options today, as I just refreshed, it raise those 5.375.

Finally, PR 5.639. Notice that's much lower than FHA even though the rate looks a touch higher the APR. And USDA for our properties in USDA eligible areas and our borrowers, that are eligible for those income types, we have rates as today, finally, PR 5.953. So typically our borrowers are gonna compare that to an FHA or a conventional option, and USDA is a touch cheaper in this example. So definitely a great borrowers.

And again, we went over some non QM options, but those were the options with bankruptcies. In general, our non QM off dock options, for we can get rates as low as 5.875, identical to conventional, which is amazing. Finally, PR with the fees included, 6.145. So just a touch higher on the cost here. Docs, such as those we went over for credit events, but we can use alternative docs for more of our standard borrowers here and get rates much.

And we can use alternative doc non QM programs for investment properties, rates is low 6%. Finally, PR 6.321. And we compare that to our conventional op our investments today coming in, again at 6% flat, finally PR 6.311. So just a touch cheaper than all that. And our favorite programs, we always wanna review the debt service coverage ratio.

No income or employment needed for these rental property loans. We simply use the estimated rents from the property to determine the DSCR ratio, the estimated rent, the expenses of the property, the PITIA of the mortgage, taxes, insurance association if applicable. Then we have a ratio of one or higher, which is what's used for these scenarios. Standard scenario, we add a three year prepayment penalty. Rates come in 5.999.

Final APR, 6.234, beating conventional. Absolutely amaze. And we can add a five year prepayment penalty. Rates don't go down. Still the same rate, 5.999, but a little lower cost there.

Finally, PR is 6.198 conventional. And we do have our no prepayment penalty option, second mortgages, all kinds of different options, commercial loans, etcetera. Please get with one of our team members if you would like a full estimate for any of our programs that we go over. But we'll go ahead and wrap the show up for today. Thanks everybody for joining us, and I hope this was for borrowers out there that may have experienced an unfortunate bankruptcy event.

Just know that the standard options are great, if you do qualify for that seasoning, but we do have for even one month out of bankruptcy, which is amazing. Thanks everybody for joining us, and we'll be back later this week with another episode of Daily Raised Live after next Fed Update. Have a great day.