How Quickly Can I Buy a House After Bankruptcy?
If you have gone through a recent bankruptcy, you probably wondered: “Is it over for me? Will I ever get to buy a home again?” While bankruptcy is serious business, it is not the end of the world. In fact, with careful planning and a considerable amount of leg work, you can often purchase another home after a waiting period of only two or three years.
The economic recession and the resulting mortgage crisis have redefined the reality of bankruptcy and lenders understand that good people often found themselves in terrible situations. As a result, lawmakers and lenders have created a number of creative ways to get people back into the housing market.
Read: How soon can I buy a car?
Here’s five ways you can help to put your application at the top of the stack of buyers with recovering credit histories:
Begin saving money.
The days of buying a home with no down payment are pretty much over. You’ll need 10-15 percent down to get favorable financing options. Try working your saving up to the point that your rent and monthly house savings account equal the amount of your former house payment. This will provide you with a substantial amount of money to put down on your next home.
Second, pay careful attention to your credit scores from all three major credit rating agencies. Make sure that everything is accurate and file an appeal for any disputed information. Your credit report is your ticket to your next mortgage.
Third, be careful not to buy everyday items on credit and drive a car that you can afford versus purchasing more car than you need with damaged credit. The money you save on the payments can be used to pad your down payment savings account.
Next, go online and set up automatic withdrawals for all of your expenses like school loans, car payments and credit cards. You can probably sign up for a monthly set fee on utilities too. All of these payments will be reported to the credit bureaus and your on-time payments will reflect positively on you when you have your down payment in hand.
Finally, consider every debt you’ve carried with you since your bankruptcy to be the enemy of your home buying plans. Put every dime you can on the balances and knock them out of the way. Avoid further debt whenever possible too. If you have experienced bankruptcy, take heart! You can move ahead again. Remember that you are in the driver’s seat and making wise choices with your money today will help ensure that you can re-enter the housing market tomorrow!
Advantage Legal Group is your source for helping you file bankruptcy and then recouping and planning for the future. Call us for Mortgage Mediation and all questions regarding foreclosures and bankruptcy.