When does the countdown for a new mortgage end?

[lostinlove]

Good Morning,

Appearently the "magic" number for mortgage after credit issues (bk, foreclosure) is 2 years. Can anyone tell me if that is two years is before closing or before applying. The reason I'm asking is I got my dates wrong (thought foreclosure was over in July 2004, actually over January 2005) and now my mortgage broker is telling me I have to go subprime. The house I have a contract on is brand new and I doubt they will be finished building it prior to January 2007, so I was wondering if I could plan on subprime for now and then switch to conventional after January 14 (the "redeemed" date). My credit score is 690+.

Thank you in advance!

[lrprn]

Since you already have a contract on a house, can you get out of it and wait until after January 2007 to put another contract down? If you go with a subprime lender now and then can't get a better rate after Jan 07 for awhile, you could be in a world of hurt, especially if the subprime is a balloon-type strategy.

What are your current FICO scores? Have you been working on cleaning up your credit reports?

[MTG_BANKER_OH]

Good Morning,

Appearently the "magic" number for mortgage after credit issues (bk, foreclosure) is 2 years. Can anyone tell me if that is two years is before closing or before applying. The reason I'm asking is I got my dates wrong (thought foreclosure was over in July 2004, actually over January 2005) and now my mortgage broker is telling me I have to go subprime. The house I have a contract on is brand new and I doubt they will be finished building it prior to January 2007, so I was wondering if I could plan on subprime for now and then switch to conventional after January 14 (the "redeemed" date). My credit score is 690+.

Thank you in advance!

It is program dependent, was your home included in a bankruptcy? It is tough to say with builders. I would think that you could get pre approved now and then switch programs if you can later on. With subprime lenders they are not going to hold your loan until the house is done you would have to go back through underwriting again in december or january anyway if they were going that route. That is if you have not gone through underwriting already.