(I am not an accountant which is why I hire a CPA to do my taxes and someone may chime in to correct my explanation on this.)

In our case, it was a bank-owned property (local bank) and the explanation provided to us was that the bank simply sold all its properties using quit-claim deeds (kind of like an extension of the no disclosure thing, is how I thought of it).

In the case of either an FHA loan or a VA loan, you must provide an explanation of the bankruptcy.Conventional LoansConventional loans have the longest waiting periods.

hi Ahmed ,I"m new investor  too and i did start by getting a membership at  http://www.flippinghouseslive.com/you will find very detail explanation of what you need to do as well as some good forms for you to print and use.Hope that can help you and good luck in the future

@Jim Adrian - That explanation is GOLD thank you for taking the time to explain it.

Also Tell your "Friends" you don't know exactly what they are talking about and see if you can understand the explanation and then tell USAre there any Real estate clubs or Real Estate Meet ups there that you can ask?

You could try and pass it down to him with some written explanation and hope for the best.

After more research & further consultation with my accountant, the explanation which Brandon Hall outlined pretty much summarized it. 

This is obviously not the perfect solution to every situation, but it is definitely a viable solution to offer a lot of distressed homeowners.I too would like to have someone else give a better explanation/example of "rehab to perm" as mentioned earlier in the thread.

Thanks for the explanation!