16 Apr Buying A Home After Bankruptcy
One of the questions I get frequently is will it be possible to buy a home after filing for bankruptcy.
In many cases the answer is yes provided you can meet all the normal underwriting requirements for income and down payments.
We receive calls almost every day with past clients that have filed for bankruptcy who are in the process of buying a home and need bankruptcy documents.
These clients have generally filed bankruptcy around two years ago and have restored their credit to excellent status.
Can I Qualify For A Home Loan After Bankruptcy?
Most of these clients were worried when they filed for bankruptcy that they would not ever qualify for home or car loans again, but they are pleasantly surprised to find their credit score post-bankruptcy qualifies them for the lowest home loan rates.
I ask these clients when they call what is their credit score and the answer is always over 700. I then ask if they are getting a good interest rate on the home loan and they have qualified for a very good interest rate.
This is possible for these former clients because the negative effects of bankruptcy filing on credit are really a myth. In most cases people’s credit before filing is far worse than it will ever be after filing if clients follow a few simple steps.
Follow These Steps To Recover Post-Bankruptcy
The first step is making sure all the information on your credit report is accurately reporting. The next step is taking steps to ensure that you rebuild your credit score by using credit responsibly and making your payments on time.
The reason why clients see such a dramatic improvement in credit scoring is simple; they get rid of their old debt, terrible payment history, and bad debt to income ratio with the filing of the bankruptcy paperwork.
Post-discharge their payment history starts fresh and the debt to income ratio is much improved.
We like to see our clients succeed post bankruptcy and achieve the dreams they have for the families.
Oftentimes one of those dreams is home ownership and by filing for bankruptcy they make that dream possible by eliminating credit card debt at 20% or higher interest rates.
If you are considering filing for bankruptcy it is a good idea to get the facts about bankruptcy before you decide on any options for your financial future. Bankruptcy can helps to relieve the stress that financial problems can create.
If you would like more information give our office a call.