Dallas Fort Worth Homes and Real Estate for Sale

If you are a physician or eligible professional in the Dallas area and are in the market to purchase a home or refinance an existing mortgage, your friends at BBVA Compass have tailored a special program called The Professional Program, which offers competitive rates and 95% mortgage financing for physicians/doctors in the Dallas area. (Program guidelines changed from 100% to 95% max financing as of 6/14/2011).

This program is only offered at BBVA Compass and is a unique opportunity for qualified Dallas area doctors/physicians and eligible professionals to obtain 95% mortgage financing on a home purchase.

 Program highlights of the Professional Program for physicians (Program rules are subject to change at any time without notice):

•  95% mortgage financing up to one million dollars for primary residences.
• NO PMI (private mortgage insurance) required!
• Eligible properties inclue Single Family Residences, Town Homes, Lofts and Condominiums. 
• Student loan payments are NOT included in the debt-to-income ratio calculation if they are deferred for at least 12 months.
• Expansion of loan-to-value ratios for physicians that want to refinance an existing mortgage.
• BBVA Compass offers a free investment and insurance review with a wealth management professional.

Doctors/Physicians Eligible for the 95% Mortgage Financing Program include:

• Resident or practicing physicians.
• Oral surgeons

Other Eligible Professions include:

•  Attorneys
• Certified Public Accountants

Is the BBVA Compass Professional Program available in other areas besides Dallas?

YES! BBVA Compass offers this program in seven states:

• Texas
• New Mexico
• Arizona
• California
• Colorado
• Florida
• Alabama

The first step in the homebuying process should always be mortgage pre-approval.  BBVA Compass makes pre-approval fast and easy.   Their automated approval system allows for quick and streamlined loan pre-approvals with no application fee. 

To consult with a BBVA Compass loan professional about this program, please call Cari Marks at (972) 705-4408.  Or you can email her directly at cari.marks@bbvacompass.com 

DISCLAIMER: I have no affiliation with BBVA Compass and am only providing this information as a service to doctors/physicians and other professionals that may benefit.  If you are a Dallas area physician in the market to purchase a home, please call me today at (972) 978-3553 or email me at johnjonesrealtor@gmail.com .

Over the last several months, mortgage rates have continued to decline thanks to institutional investors seeking the safe haven of bonds over stocks in this uncertain economy.  When investors buy mortgage bonds, this tends to lower the rates.  

As of last Thursday, August 26, Freddie Mac reported the lowest rates since they began keeping records in 1971 for 30 year fixed rates and 1991 for 15 year fixed rates.   The average rate on a 30 year fixed rate mortgage was reported to be 4.36%.  The average on 15 year fixed mortgages was reported to be 3.86%.  

These rates are averages compiled from their weekly mortgage rate survey of lenders nationwide.  Actual rates that borrowers receive vary according to a variety of factors, including credit score, loan-to-value ratio, origination charge and other risk factors.  Freddie Mac does not dictate rates; they purchase mortgages from banks to free up capital for additional investment. 

To put these rates in perspective, here's a chart of the average rates reported by Freddie Mac since the beginning of 2010:

So how long will this cheap money last?  It's hard to say, but as long as uncertainty about solid growth and recovery persists, institutional investors may continue to prefer the safety of bonds over the risk of stocks.   But predicting the market is tricky business, and a number of factors could affect this trend over the coming months and years.    

Despite the weakness in the housing market, many homeowners are taking advantage of the low rates to lower their mortgage payments.  In fact, refinancing currently makes up over 82% of all new loan activity in the market. 

In the year 2000, Freddie Mac reported 30 year fixed mortgage rates reached as high as 8.52%.  They once reached a high of 18.45% during the high inflation period of the early 1980s.  During most of the 2000s, they've hovered between the mid 5% and low 7% range. 

Once the financial crisis began to unfold in late 2008, the government began an unprecedented program to purchase mortgage-backed securities with the goal of keeping mortgage rates as low as possible.  In December of 2008, Freddie Mac reported the average mortgage rate on a 30 year mortgage had dropped to 5.33%. And although this program ended earlier this year, mortgage rates have remained at or near historical lows because of continued investor demand for safe-haven investments.  Fannie Mae and Freddie Mac bonds now carry an explicit guarantee, which essentially means they carry the same guarantee as US Treasury bonds.  (It also means that taxpayers are on the hook for the losses). 

Here are some examples of mortgage payments at various interest rates:

Monthly principal and interest payment on a 30 year fixed rate mortgage ($100,000 loan):

4%- $477.42

5%- $536.82

6%- $599.55

7%- $665.30

8%- $733.76

9%- $804.62

Monthly principal and interest payment on a 15 year fixed rate mortgage ($100,000 loan): 

4%- $739.69

5%- $790.79

6%- $843.86

7%- $898.83

8%- $955.65

9%- $1,014.27

Many buyers in the early stages of either looking for a home or researching their mortgage options often choose to obtain their credit report and credit scores from one of the various "free" credit report offers available online.   I've noticed this trend over the last few years with new clients.  Many of them already have their credit report and credit scores before they ever speak with a lender or Realtor. 

I say "free" because these services typically require enrollment in a membership which must be cancelled or they will be charged a monthly fee.  The monthly service fee typically includes a service or services that can be useful, such as regular updates of their credit report, identity theft protection or credit monitoring.  Credit monitoring is a service that notifies consumers via email whenever new activity occurs on their credit report, which can help detect fraud and errors quickly before they become a serious problem. 

So despite the fact that some of these "free" credit report offers may be marketed in a somewhat misleading manner, the services they provide with the monthly membership can certainly be helpful to consumers, especially those getting ready to purchase a home and want to keep a handle on what's happening on their credit report. 

In addition to these services, the membership usually provides consumers with instant access to both their credit report and credit scores, which is often the main motivation for signing up for the service in the first place. 

Which brings me to my main point - THE CREDIT SCORES THAT MANY OF THESE SERVICES PROVIDE ARE NOT THE SAME CREDIT SCORES THAT LENDERS USE TO QUALIFY BORROWERS. 

In other words, the credit score they see on their "free" credit report is often not the same score a mortgage lender sees on the report they obtain from the three credit bureaus.  Mortgage lenders must pull their own report; they cannot use a copy of a consumer report from a "free" credit report service to issue a formal loan approval. 

Anyone can create a mathematical model or algorithm and market it as a "free" credit score.   But the "official" credit score that mortgage lenders use is called a FICO® Score.  Mortgage lenders usually qualify borrowers based on the median FICO® score acquired from the three credit repositories: Equifax, Experian and Trans Union.  

And yes, it gets a little more confusing.  Each credit repository has slightly different versions of the FICO® Scoring model and each bureau can have different info on a single consumer that causes the scores to vary from one repository to the next. 

How to sift through all of the confusion and find out where you stand?  If you're in the market for a mortgage, the easiest way is to simply contact a lender and get pre-qualified.  Most mortgage lenders will provide borrowers with a copy of their credit report either at their cost (which is usually less than $20) or for free.   

There are some credit report offers on the internet that do provide a FICO® Score, but usually only from one credit bureau.  To obtain all three without going through enormous hassle, it's usually easiest to just talk to a lender. 

But won't credit inquiries destroy your credit score?  Not at all.  That's one of the biggest myths I hear from consumers and even some mortgage lenders as well.  The truth is that special rules apply to mortgage credit inquiries.  In fact, according to MyFico.com, it's OK to have your credit pulled by multiple mortgage lenders as long as the inquiries occur within a certain period of time. 

So if you're in the market to purchase a home, it pays to have a mortgage lender obtain your credit report as quickly as possible.  Credit monitoring can certainly provide consumers with a good way to quickly identify any activity that might potentially affect a loan approval or their ability to qualify for the best interest rates.

And to obtain a copy of your credit report completely free, visit www.annualcreditreport.com

Each week, Freddie Mac releases the results of their mortgage rate survey they conduct to sample mortgage rates offered by lenders and brokers around the country.  Although some interpret this survey as the "rate that Freddie Mac sets" for mortgages, it is not; rates are not set by Freddie Mac directly, but rather by individual lenders and brokers based on mortgage bond pricing. Other factors can also affect these rates, such as the borrower's credit score, down payment, the property type and the total origination charge (points) that the lender is charging in order to obtain a certain rate.

In other words, the rates published in this survey are AVERAGES; they are not the exact rate that every single borrower can expect to receive.  Some borrowers may be able to secure a lower rate if they are making a large down payment and have excellent credit, whereas borrowers with lower credit scores and who may be purchasing properties with higher risk factors may not be able to lock in rates this low.

The results of this survey are published by Freddie Mac every Thursday.  They show average rates for four types of loan terms: 30 year fixed rate, 15 year fixed rate, 5/1 adjustable rate and One year adjustable rate mortgages.

The average mortgage rates reported by Freddie Mac as of today (April 22, 2010) were:

30 Year Fixed Rate Mortgage - 5.07%

15 Year Fixed Rate Mortgage - 4.39%

5/1 ARM - 4.03%

One Year ARM - 4.22%

And here's a chart that shows the trend of these four rate categories since the first of the year:

While rates have climbed some since the 2010 low set back in February, they are still near historic lows.  The end of the Federal Reserve program to purchase mortgage-backed securities has not had as much impact on interest rates as some expected, but the market has not had much time to adjust to this new reality as of yet.

FHA loans are definitely the loan of choice for many home buyers in today's market.  FHA has flexible underwriting requirements, competitive interest rates and offers a low minimum down payment of just 3.5%. 

WHAT IS AN FHA LOAN?

An FHA loan is a loan guaranteed by the Federal Housing Administration.  The money itself does not come from FHA, but they do charge a fee to the borrower to insure the loan for the lender.  Without this insurance, the interest rate would be significantly higher because of added risk to the lender. 

WHAT IS COMMONLY REQUIRED TO QUALIFY FOR AN FHA LOAN?

In general, the following are the minimum requirements to obtain an FHA loan:

• A STABLE CREDIT HISTORY WITH AT LEAST THREE CREDIT REFERENCES THAT HAVE BEEN OPEN FOR TWELVE MONTHS AND ACTIVE WITHIN THE LAST SIX MONTHS.  Credit score requirements vary from one lender to the next, but FHA specifically requires borrowers to have at least this minimum of three credit references.  Some lenders may allow these references to come from non-traditional sources, such as a letter from a utility provider, insurance company, etc. 
• TWO YEARS OF INCOME AND EMPLOYMENT HISTORY that show the borrower's income is likely to continue for at least 2-3 years.  (NOTE - The two year income history may be waived in certain situations, such as for college graduates who just started a job in a field related to their degree). 
• BORROWER MUST HAVE A SATISFACTORY INCOME AND DEBT-TO-INCOME RATIO.  FHA looks at these two specific ratios to determine an acceptable payment for a borrower. 
• PROOF OF FUNDS FOR DOWN PAYMENT AND CLOSING COSTS.  Funds typically must be sourced and/or seasoned for 60 days.  "Sourced" means the borrower must prove those funds came from an acceptable source, such as income from employment, gift from a relative or other type of source acceptable to FHA.  "Seasoned" means money that the borrower has shown in their account for a period of 60 days.  Borrowers who can prove funds have been in their account for at least 60 days typically do not have to show the source of the funds.
• GOOD RENTAL AND/OR MORTGAGE HISTORY is often required as well.  Again, the requirements for this vary depending on the overall circumstances.
• OTHER REQUIREMENTS MAY APPLY. 
• PAST CREDIT ISSUES - FHA has certain specific requirements as far as how long a borrower must be out of both a foreclosure and a chapter 7 bankruptcy.  FHA allows buyers currently in a chapter 13 bankruptcy to obtain a loan if they can show at least 12 months of satisfactory payment history and meet the other loan requirements.  Borrowers currently in a chapter 13 bankruptcy must also obtain written permission from the bankrutpcy trustee to obtain a new loan.  FHA has similar requirements for borrowers in CCCS.  Borrowers with past credit issues, such as late payments, collections, charge offs, reposessions may qualify for FHA financing if an underwriter deems them to be past issues that aren't likely to recur. 

While FHA has their own set of requirements, lenders may also impose overlay guidelines, which are requirements that may be over and above the minimum standards that FHA requires.  For example, FHA does not have a specific minimum credit score at the moment, but virtually all lenders have some kind of minimum credit score requirement for borrowers seeking FHA financing.   FHA will begin requiring borrowers with a credit score of less than 580 to put down at least 10% beginning sometime in the summer of 2010.

WHAT IS INCLUDED IN THE MONTHLY PAYMENT FOR AN FHA LOAN?

FHA is a budget loan, which means the property taxes and home owner's insurance must be included as part of the monthly payment.  Also, FHA charges both an upfront and monthly mortgage insurance premium that insures the loan for the lender in case of default.   

FHA does not require this monthly MIP to be paid on 15 year loans that are less than or equal to 90% LTV.  Buyers who make a larger down payment may also receive a discount on the monthly MIP.  Also, FHA allows the monthly MIP to be removed once the borrower pays down at least 22% of their loan balance, but not before at least five years. 

FHA is changing their requirements for MIP effective on all case numbers issued after April 5, 2010.

WHAT IS THE MAXIMUM LOAN AMOUNT FOR AN FHA LOAN IN DALLAS?

The FHA loan limit for most counties in the Dallas Fort Worth area is currently $271,050.  This loan limit applies to the loan amount calculated BEFORE the upfront MIP is added to the loan.   FHA does not have a maximum sales price, only a maximum loan amount. 

WHAT IS THE MINIMUM DOWN PAYMENT FOR AN FHA LOAN?

For home purchases, FHA requires a buyer to put down a minimum down payment of 3.5% of the purchase price of a home.   The closing costs and prepaid items are over and above the 3.5% down payment.  However, at this time, FHA allows up to 6% of the closing costs and prepaid items to be paid by the seller.  FHA did recently announce that the maximum seller contribution will be reduced to 3% beginning sometime in the summer of 2010.  

The closing costs and prepaids vary from one lender to the next and also vary depending on other factors, such as property tax rates and the insurance rate the borrower is able to secure on the home.  

DOES FHA REQUIRE THE CONDITION OF HOMES TO BE UP TO A CERTAIN STANDARD?

Yes.  An FHA appraiser will inspect the property to make sure the home meets certain property condition standards required by FHA.  These standards were changed in 2005 and are not as strict as they used to be, but the do still require certain items to be repaired before closing can occur.  

HOW CAN I SEE IF I QUALIFY FOR AN FHA LOAN?

Call John Rasor at Homewood Mortgage at (214) 507-1480 or apply online.

Effective on all case numbers issued on or after April 5, 2010, HUD will increase the upfront mortgage insurance premium for FHA loans from the current rate of 1.75% to 2.25%.  Dallas area home buyers that want to take advantage of the lower upfront MIP premiums must have a property under contract prior to April 5 and their mortgage lender must request an FHA case number on the property in order to secure the current lower premium of 1.75%. 

The increase in upfront MIP premiums is due to FHA falling below the required 2% level of reserves in order to operate.  When reserves fall, the deficit has to be made up in some way. 

The increase in premiums will equate to a $500 increase for every $100,000 in loan amount.  A $200,000 loan will see an increase of $1,000 in upfront premium. 

WILL MONTHLY FHA MIP PREMIUMS ALSO INCREASE?

NO, not at this time.  The following premiums will remain in force for FHA loans:

LOAN TERMS GREATER THAN 15 YEARS (20, 25 and 30 year terms):

For loans with a loan to value ratio LESS THAN OR EQUAL TO 95%, the monthly premium is .5% of the initial loan amount, divided by 12.    For a $100,000 loan, this works out to be $41.66 per month. 

For loans with a loan to value ratio GREATER THAN 95%, the monthly premium is .55% of the initial loan amount, divided by 12.  For a $100,000 loan, this works out to be $45.83 per month. 

LOAN TERMS OF 15 YEARS OR LESS:

For loans with a loan to value ratio GREATER THAN 90%, the monthly premium is .25% of the initial loan amount, divided by 12.  For a $100,000 loan, this works out to be $20.83 per month.

For loans with a loan to value ratio of LESS THAN OR EQUAL TO 90%, FHA does not require monthly mortgage insurance. 

Buyers who secure a purchase contract prior to the April 5, 2010 deadline should consult with their lender to ensure that an FHA case number is issued on the property to secure the lower premium. 

The complete information regarding this change can be found here. 

If all goes as planned, the Federal Reserve will cease its program of purchasing mortgage-backed securities on March 31.  This program, which was created under the Bush Administration and then expanded under the Obama Administration, has served to keep mortgage rates at or near 50 year lows for the last several months.  The program has certainly achieved its objective of keeping rates low, but many fear the potential liability this program has created for the American public by effectively socializing the mortgage market. 

The end of this program will effectively mean the government will remove the mortgage market from "life support".  Nobody knows exactly what will happen when this occurs, but simply looking at the numbers suggests that rates will increase if the large demand of mortgage-backed securities is not offset by an increase in demand from institutional investors. 

Many economists have estimated that Fed purchases under this program have accounted for as much as 80% of the agency mortgage bonds that have been sold since the creation of this program.  From a supply and demand standpoint, one has to wonder just how much slack will be picked up by institutional investors once the government assistance ends. 

In a "normal" economy, the government does not directly intervine in the mortgage market; rates are determined by the supply and demand of mortgage-backed securities, which is a function of the open markets.  Government purchases of these bonds effectively means they are keeping rates "artificially low" by buying up a large portion of the supply of mortgage bonds. 

HOW MIGHT THE END OF THE FEDERAL RESERVE PROGRAM TO PURCHASE MORTGAGE-BACKED SECURITIES AFFECT HOME BUYERS AND HOME OWNERS LOOKING TO REFINANCE THEIR MORTGAGE?

• MORTGAGE RATES MAY INCREASE, PERHAPS RAPIDLY - If the decrease in government demand for mortgage-backed securities is not offset by an increase in demand from institutional investors, mortgage rates will almost certainly increase.  Again, nobody knows by how much, but just knowing that the government is purchasing as much as 80% of the securities in the market, the increase could potentially be substantial.   
• PURCHASING POWER MAY DECLINE - When and if rates increase, home buyers who qualified with a lender at lower interest rates may find their purchasing power has declined.  For example, the principal and interest payment on a $150,000, 30 year fixed rate mortgage at a rate of 5% is $805.23.  At a rate of 6%, the payment jumps to over $899.  The same payment of $805.23 will only purchase $134,305 at 6%.  So a 1% increase in mortgage rates can reduce purchasing power by over 10%! 
• SOME HOME BUYERS WHO QUALIFIED UNDER THE LOW RATES PRIOR TO THE END OF THE PROGRAM MAY DISCOVER THEY QUALIFY FOR MUCH LESS IF RATES INCREASE - A home buyer who qualifies for a $150,000 home mortgage at 5% might be startled to hear from their lender that they only qualify for $135,000 if rates go to 6%.  Mortgage qualifications are based on several factors, so not all home buyers may be affected in this way.  But it's certainly a possibility. 
• HOME OWNERS LOOKING TO REFINANCE THEIR MORTGAGE MAY LOSE ANY BENEFIT OF REFINANCING IF RATES INCREASE.  There are costs associated with refinancing.  Those costs generally need to be offset by the monthly savings a home owner will receive in order to justify refinancing their mortgage.  The higher the rate, the longer it will take to justify this cost savings.  And in some cases, the payment may not even decrease even with a lower rate because of the increase in the loan balance due to rolling closing costs into the loan. 

WILL THE FED EXTEND THIS PROGRAM?

It is always possible that the Fed could decide to extend this program; it was already expanded in March of last year.  However, public and government support of socialist programs like this one has certainly waned over the last several months.  Additionally, many inside the government and the Fed have expressed a desire to fundamentally change how the mortgage market works, even going as far as to suggest Fannie and Freddie should be dissolved in favor of another system.  What that system will look like is anyone's guess at this point.

CHAPTER 13 BANKRUPTCY AND REBUILDING CREDIT FOR DALLAS HOMEBUYERS

Over the weekend, I received a letter from a gentleman who found my Chapter 13 bankruptcy blog online and had a few more specific questions.  So i decided to post the questions and answers here (with his permission, of course) for everyone to see.

Here's a list of the questions (in bold):

"Hello John- Your chapter 13 and FHA loan article is very concise and helpful. A few additional questions- When opening at least 3 new credit lines should they be a combo of installment and revolving with low or high balances from month to month? "

I would recommend getting two revolving accounts and one installment account to even out the mix.  10% of your credit score is based on having a fair mix of credit, so two revolving and one installment account should do the trick.  As far as the balances, there's no need to keep a high balance on the credit cards.  In fact, this can hurt in the long run because a significant part of your credit score is determined by debt to limit ratios for each open account.  Ideally, i would recommend keeping the balance of the credit cards below 25-50% of their respective limits at all times.

"And... We are in a chapter 13 ( five year plan and currently on month 19) My wife has been on her salaried job for 19 years and I am just starting a new salaried job. Have been out of work for 9 months yet the new job is what I did before- Does FHA still require a full 2 years for me or less time to qualify?"

FHA does require a two year employment history.  However, an underwriter may grant an exception to this rule if the job loss was due to factors beyond your control and if the new job is comparable to the previous job. FHA will still want a full two year work history, so they will just require documentation of the previous two years before the nine month job loss.  Going from a salaried job to another salaried job is just fine.  If you would have started your own business this go-round, FHA would have required a two year history of earnings for the new business. 

If we wait for the Chapter 13 to run its full 60 month course can we apply for an FHA loan the day after? It seems odd that one can apply for a FHA loan while actually in a Chapter 13.

I agree it seems odd, but it's the truth.  FHA does allow a borrower to obtain an FHA loan even if they're currently in a Chapter 13 bankruptcy.  However, there are a few guidelines and requirements that must be met:

• The borrower must have made at least 12 months of timely payments in the Chapter 13 repayment plan. 
• Payment history on accounts not included in the bankruptcy must be near perfect.  This is ultimately an underwriter's call, but they are typically very strict with regards to payment history for all accounts once a bankruptcy has been filed.
• The borrower must meet all other underwriting requirements to obtain an FHA loan (acceptable job history, debt-to-income ratios, cash reserves, credit score, etc).  A loan officer and underwriter will make this determination. 
• The bankruptcy trustee must give written permission for the borrower to obtain a mortgage.  This is true for both purchases and refinances.  To the best of my knowledge and based on my past experiences, there are no specific guidelines for this, but the trustee will generally not approve a request to increase the current payment by very much if any at all.  For example, a person who pays $1000 per month for rent would likely be restricted from purchasing a home with a mortgage of over $1000 per month.  An exception could possibly be made in cases where a specific and compelling need to increase the size of the family home due to a chance in familial status is present (such as an elderly parent having to move in with the family or the birth of a new child).  If you have specific questions, please contact the bankruptcy trustee directly. 

Once the bankruptcy is completed (discharged) and all payments have been disbursed to creditors, you may apply for an FHA loan without having to obtain a letter of permission from the bankruptcy trustee.   But as I mentioned above, it may be possible to obtain a mortgage prior to discharge of a Chapter 13 bankruptcy.  This may or may not be a good idea, depending on your individual financial situation. 

It's very important to focus on rebuilding your financial strength both during and after a bankruptcy.  Ideally, a buyer should try to save at least twelve months of cash reserves in addition to the money needed for down payment. 

Also, make sure to keep all records pertaining to the bankruptcy, including the full petition, discharge and especially the record pf payments to the trustee.  It's not uncommon to see errors on accounts that have been included in a bankruptcy because the creditor did not note the account as included in a bankruptcy. 

Feel free to email me with any specific questions related to this or any other issue regarding credit, mortgages or real estate in the Dallas / Fort Worth area. 

Title insurance is insurance that protects the title of a home against any defects or claims that occured on the property prior to the closing date.  It is required by virtually all lenders in order to secure a loan as well. 

Payment of the owner's title insurance policy is negotiable in the State Of Texas.  The owner's policy is customarily paid by the seller in the state of Texas, but may be paid by either party.  Part 6 of the TREC Promulgated Contract (One To Four Family Contract) indicates whether the buyer or seller will pay the owner's title policy. 

The U.S. Department of Housing and Urban Development does not automatically pay the title policy on HUD homes.  Furthermore, many lenders do not require an owner's title policy on a HUD home if the buyer is using FHA financing, but as a realtor I would strongly recommend getting one regardless of whether or not the lender requires it. 

The rates listed below are for the owner's title insurance policy only.  Lenders typically will also require a seperate policy covering their interest in the property as well.  The cost for the lender's policy is significantly less than the cost of the owner's policy when purchased in conjunction with an owner's policy from the same title company.  Contact Marie Quill with Republic Title at 214-341-7733 for a quote on the lender's policy rates.

Although many people fear the negative stigma associated with bankruptcy, sometimes it may be the only "make sense" option to recover from a financial crisis.  However, many of the general rumors about Bankruptcy are overblown, such as the notion that it will "ruin your credit" for 7-10 years.  The truth is that although a bankruptcy will stay on your credit report for a long time (7 years for a Chapter 13 and 10 years for a Chapter 7), it's quite possible to build your credit back up to a range that's acceptable to qualify for a mortgage and even obtain what most lenders would consider a "good" credit score in as little as two years.  Furthermore, it may be possible to qualify for an FHA loan with an active Chapter 13 Bankruptcy as little as 12 months after establishing a repayment plan. 

Here's a summary of FHA guidelines to obtain a loan while in a Chapter 13 Bankruptcy:

• Borrower must have made at least 12 on-time payments to the Bankruptcy trustee.
• The Bankruptcy Trustee must APPROVE the purchase of a new home (or refinance).
• The borrower must have a good payment history on accounts that are not included in the bankruptcy. 
• All other guidelines to obtain an FHA loan must also be met.

I'm not an attorney or an expert on what a Bankruptcy Trustee will approve, other than to say it must generally "make sense". 

Furthermore, many lenders will require each borrower to have at least a minimum median credit score of 580-620.  Although FHA does not specifically have a minimum credit score, virtually every lender has their own minimum requirements. 

In addition to these general requirements, lenders will expect to see some additional credit references besides just paying the Bankruptcy on time.  FHA requires a minimum of three credit references that have been open for at least 12 months and that have had some kind of activity within the last six months.  Borrowers that don't have three credit references that report to the credit bureau may use alternative references in some cases, such as rental history, insurance and utility payments and/or other accounts or lines of credit that are paid monthly.  However, I strongly recommend maintaining at least three open and active tradelines for people that have had past bankruptcies since it takes rebuilding some good credit to offset past bad credit.  Also, most accounts that are included in Bankruptcy will be closed once the BK is completed.  Without establishing new credit, the credit score may remain very low for a long time.  A good alternative may be to obtain one or more secured credit cards. 

If you are contemplating filing Bankruptcy, seek advice from a competent attorney and review your options.  It may also be a good idea to speak with a mortgage lender for advice on how to structure your debts to obtain the maximum long term benefit for both your net worth and credit score.  While credit score is important, it's also something that can be repaired with time.