Urgent, please help with FHA loan question

[mmferg]

We filed chapter 7 bankruptcy in 2009 after my husband lost his job, and we no longer could afford our home or bills. The bankruptcy which included our home was discharged in 2009.

Fast forward to today. We are in the process of buying a home, we are suppose to close 3/29 and I get a call today say that there is a snag with our FHA financing because Wells Fargo did not take our name off the title of the home until 2/28/12. I am devastated!!!

Is there anything that we can do or are with just out of luck because WF took there sweet time changing the title?

[tobee43]

mmferg, first welcome to forum!

i'm so sorry to hear about your snag...any chance you can go conventional???? they have been pretty stringent on the FHA guidelines with bks and foreclosure times. 2 years from one 3 years from another...or is it the other way around....but ultimately and unfortunately it's up to the lenders underwriters.

i can't believe they waited this long, i also knew of someone else this happened to, and they never even had a bk or a foreclosure! so the banks are being pretty hard nosed about it

[mmferg]

Thank you! With this short of notice, there is no way we could come up with 20% down to go conventional.

Can we dispute with wells fargo that the loan should not have been titled in our name after the bankruptcy was discharged in 2009?

[df04527]

You can try but I really doubt they will do anything as the banks are taking their time and i personally believe they are doing it on purpose to nail the homeowners who defaulted. My personal opinion. Many here are still waiting after years!

[tobee43]

i really feel for you. the other couple i knew had a moving truck with all these things on the closing date and the bank stopped the closing! they had two small kids...what a mess. the banks are ruthless, maybe your broker or real estate person has some suggestions?

the banks can do what they please, it's really terrible, and it's changing anytime soon, i'm afraid. can you try another lender?

[mmferg]

Thank you both for your responses. We are in the same boat, 3 kids and 3 tiny dogs and no place to live as of April 1st.

I think I might try to call an attorney.

[NoMoreCards]

I'm not sure how a attorney can help,unfortunately their no time restrictions on when banks must foreclose. Many people. are finding owner financing and creative ways to own a home again. I wish you the best.

[researchnerd]

I'm so sorry this happened to you. Wells Fargo is evil.

I thought our situation was bad - Ch7 was discharged in November 2010 but the foreclosure didn't actually happen until almost a year later. I only found out in December 2011 when my insurance agent called to say they were canceling the homeowner's insurance due to foreclosure. The mortgage was included in the bankruptcy, but as I understand it, the FHA waiting period is from date of foreclosure, not BK discharge. It makes no sense to me if the mortgage is IIB.

Do you know when your actual foreclosure sale happened? Do you have any other options, maybe USDA?

[justbroke]

Please, go back to your FHA underwriter and ask for a "extenuating circumstances" exception. They usually want something in writing. You "may" be able to explain that you discharged the debt and moved out in 2009 and Well Fargo took their time (3 years) to foreclose. In the meantime, you rented and paid your rent on time (payment history attached), and have maintained very good credit. (If you have an exception as to why you went bankruptcy to begin with, medical, death, loss of income, military, military death, etc, you may be able to get an exception on those grounds as well. It really depends on how much your "extenuating circumstance" is weighted.)

Other than that, there's no way to get around the particular problem (that is unique to the foreclosure crisis). You will never know if the "it wasn't my fault" angle unless you try! You may need to shop some other banks as well.