Mortgages After Bankruptcy or Foreclosure in Austin
- After BK, foreclosure or short sale
- Non-QM
- Purchase or refinance
- Texas
A bankruptcy, foreclosure or short sale is often the result of a job loss, a medical bill, a divorce or a business that didn’t make it. It doesn’t define you as a borrower. If your income and finances have recovered, it’s worth finding out what’s possible now instead of assuming you have to wait. This program is part of our non-QM loan options.
Mortgages After Bankruptcy or Foreclosure: when it fits and when to look elsewhere
| Loan category | Non-QM |
|---|---|
| Who it’s for | Borrowers with a recent bankruptcy, foreclosure, short sale or similar credit event |
| How income or eligibility is shown | Full or alternative documentation, depending on the lender and program |
| Property types | Owner-occupied, second home or investment (varies by program) |
| Fits when | You’ve had a recent credit event · Your income has recovered · You don’t want to wait out agency waiting periods |
| Look elsewhere when | You’re already past agency waiting periods. FHA or conventional may fit. |
| Lenders compared | More than 50 wholesale lenders |
The short answer: You may be able to get a mortgage in Texas after a bankruptcy, foreclosure or short sale sooner than agency loans allow, because some non-QM lenders write their own waiting-period rules. What’s possible depends on the event, the time since and how your credit and income look today, and it varies by lender. CapFi Lending, an Austin broker licensed to make loans anywhere in Texas, compares options across more than 50 wholesale lenders.
Non-QM after a credit event vs FHA or conventional
| Non-QM after a credit event | FHA or conventional | |
|---|---|---|
| Waiting period rules | Set by each lender; some lenders allow shorter waits | Set by agency guidelines |
| Recent events | Some lenders will consider them | Must meet agency waiting period |
| Income documentation | Full doc or alternative doc (e.g., bank statements), per lender | Full documentation |
| Down payment | Varies by lender; often more equity | Depends on program |
| Pricing | Typically costs more | Often prices better if you qualify |
| Path later | Can refinance into agency once eligible | n/a |
| Property types | Owner-occupied, second home or investment; varies by program | Depends on program |
Agency waiting periods vs non-QM
Waiting periods vary by lender and program; some lenders will consider a recent event. Agency loans such as FHA and conventional set their own rules, and non-QM lenders write theirs. If you’re already past the agency waiting period, an agency loan may be the better fit, and we’ll compare both.
What lenders look at after a credit event
- How much time has passed since the event
- How you’ve handled credit since then
- Your current income and its stability
- Your down payment and reserves
Requirements vary by lender.
Steps to prepare
1. Gather your bankruptcy discharge or foreclosure or short sale paperwork
2. Pull your credit reports and check them for errors
3. Keep current accounts paid on time
4. Save toward a down payment and reserves
5. Read our guide to credit health before you apply
6. Talk with us early, so you know which lenders fit your timeline
Fits when
- You’ve had a recent credit event
- Your income has recovered
- You don’t want to wait out agency waiting periods
Look elsewhere when
- You’re already past agency waiting periods. FHA or conventional may fit.
Documents
- Bankruptcy discharge, or foreclosure or short sale paperwork
- Income documentation (self-employed borrowers can compare bank statement and self-employed options)
- Asset statements
- Government-issued ID
How CapFi shops it
Lenders treat credit events very differently. I compare options across more than 50 wholesale lenders, and we can sign up an additional lender if your scenario needs one. We’ll give you a straight answer on where you stand today and what would improve your options.
FAQs
Can I get a mortgage soon after bankruptcy in Texas?
Possibly. Some non-QM lenders allow shorter waiting periods after bankruptcy, foreclosure or short sale than agency loans do. Terms vary by lender and your situation, including the type of event, how long ago it happened and how your credit and income look now. A broker can compare several lenders for you.
What do lenders want to see after a foreclosure?
Lenders usually look at time since the event, credit since then, income, and down payment or reserves. They want to see that the circumstances behind the foreclosure have been resolved. Requirements vary by lender, so CapFi Lending compares options across more than 50 wholesale lenders for your scenario.
Does Chapter 7 vs Chapter 13 bankruptcy change my mortgage options?
It can. Waiting periods vary by lender and chapter, and some lenders treat Chapter 7 and Chapter 13 differently, including whether they’ll consider a borrower still in a repayment plan. Bring your bankruptcy paperwork and we’ll check which lenders fit your timeline.
Can I refinance into a conventional or FHA loan later?
Often, yes. Many borrowers use a non-QM loan to buy now, then refinance into an agency loan once they’re past the agency waiting period and their credit has rebuilt. That isn’t guaranteed, since it depends on rates, values and your finances at the time. We’ll map out that path before you close.
Can I get a mortgage after a short sale or deed-in-lieu?
Possibly, and sooner with some non-QM lenders than with agency loans. Lenders look at how long ago the event happened, your credit since and your current income and down payment. Short sales, deeds-in-lieu and foreclosures may be treated differently, which varies by lender. We’ll review your paperwork and tell you where you stand today.
Will a past credit event affect my interest rate?
Usually, yes. Loans after a recent credit event typically price higher than agency loans, and terms can improve as more time passes. How much depends on the lender, the event and your file. We show you options from several lenders side by side, and we’ll tell you honestly if waiting a bit would open better terms.
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- CapFi Lending
- Licensed in Texas
- Equal Housing Opportunity
Program availability, eligibility and terms are set by each lender and vary by lender and scenario. This is not a commitment to lend.
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