Many people have filed for chapter 7 or 13 bankruptcy, and are left to wonder if there is any way they can get their life back in order. Some feel that owning a home is just a dream. However, First, be patient. Obviously, some mistakes have been made in the past, and it will take some time to remedy the situation. Receiving a home loan after bankruptcy is a process, but may be achieved in as little as two years. The “time-frame” lenders are willing to look into issuing a loan will depend on the circumstances behind the need for bankruptcy protection, and financial management afterwards. You must understand that it is a process work towards bankruptcy mortgage loans.
Second, properly manage your finances. If you are going to be seen as an acceptable credit risk again, you need to show you are going to be able to pay your debts. Chapter 13 bankruptcy is basically a consolidation loan. All your debts are lumped into one, to one creditor. You will not be able to easily receive credit. A secured credit card is a good option to help build up your credit, however, you cannot “max-out” your credit. It can prove lack of financial responsibility. Payoff debt as quickly as possible, this will show renewed dedication to financial stability.
Lastly, save as much money as possible. A good down payment will provide equity, bridging the gap between home value and the loan amount. The larger the down payment the less risk incurred by the lender. Obviously, making bankruptcy mortgage loans more realistic. It can be difficult, but frugality is vital.
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