Am I stuck renting for the duration of Ch 13?

[StuckinBK]

We filed Ch 13 a year ago. The #1 cause of our debt was buying a home we couldn't afford (ahhh, hindsight). We sold the house Jul 08 in a short sale and our attorney suggested Ch 13 as a way to avoid a deficiency judgement. The house was mortgaged for 80,000 more than it was worth. The mortgage Co never filed a deficiency, nor did they file a claim for the difference between the sale price and what remained on the mortgage.

The only bills being paid thru our plan right now are our vehicle payments. There are some unsecured creditors with claims - personal loans, credit cards - which are not yet receiving anything. I'm assuming they will once the cars are paid and we continue the remaining years?

Down to my issue though - Between the short sale and the BK, our credit scores have plummeted from the 700's to the 520's. Even if we were to petition the court for their blessing to purchase a house, there is no way we could qualify for even the WORST loan rates. I have been a homeowner for over 20 years and have been renting since this debacle (yes I know, I did it to myself by getting in over my head). But I would give anything to be able to purchase a modest (affordable) home. I'm not trying to procure a mansion, I just hate throwing money away on rent. Even the house we're in now would cost much less per month to buy than to rent.

Am I just trapped until my score rebounds? Its so discouraging.

[zeezee]

Well, from what alot of posters say on this site it will be near impossible to get a home while in ch13.

Maybe you can rent the home your in right now with an option to buy. That way a portion of your rent payments can go towards a down payment and then by the time your bk is discharged down the road you will be in a better position to go on and purchase.

[optimistic1]

FHA is the way to go, current requirements I believe are credit scores as low as 620, sometimes even lower. FHA doesnt typically utilize a score, rather other requirements, but the lenders that sell these loans usually have their own standards.

To qualify for FHA, you could not own a home within the last three years.

This is your only hope, talk to some mortgage brokers that specialize in FHA mortgages and see what you can find out.

If you get approved, get permission from the court, then modify your schedules.