I just closed an FHA loan where my clients just wrapped up a Consumer Credit Counseling (CCC) program and most lenders treat CCC as a BK. There is a provision in HUD’s guidelines that allows an FHA lender will fund a loan AND allow the BK to stay open. I said “may” at the beginning of the message due to the late you spoke of. the trustee, the judge and the person’s attorney all have to approve the deal and a pay history from the trustee will be needed for review by the lender. I disagree with whoever said toss the deal in the trash but you should pull a merged report before you submit the deal to a lender to be sure that everything listed in the credit report is also listed in the court papers. The chances are good that some creditor did not respond to the courts to have their interest represented in the BK and the debt was placed with a collection agency. Under this program, any debt that is not being paid though the courts and shows up on credit is a possible deal killer.
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