Feed on
Posts
Comments

It is possible to buy a home after filing for bankruptcy or going through a foreclosure if you take the time to prepare yourself to make the task less difficult. The mortgage industry is still changing constantly and lenders are adhering to more strict standards so you must know exactly what you have to do prior to getting in.. Buying a Home After Bankruptcy You should first know what the normal waiting period is before approaching lenders with your application for a home loan. Under usual circumstances you need to wait at least 2 years after bankruptcy (chapter 7 bankruptcies) and 3 years for closures. If you had a Chapter 13 bankruptcy and need to refinance a home you may be able to get a loan after 1 year of timely payments and with authorization from a court appointed official. Be sure to check your credit report to see that it is correct. Many times when bankruptcy and foreclosure information is included with a credit report there are errors. You can get a copy of your report with a score online, just do a price comparison and make sure you are getting the three major bureaus. If you need help understanding the report take it to your bank and get someone there who knows credit reports to go over it with you. Usually they can offer very helpful information detailing the particulars on the report and provide solutions to get you on the path of restitution. What Lenders Want to See Following a Bankruptcy or Foreclosure? Buy a Home After Foreclosure Lenders will check your report for any unfavorable actions that may have been added following the bankruptcy or foreclosure to see if you’re taking steps to get your credit back on course. They also want to see some positive things to reveal that you are taking financial responsibility and dealing with your debt in a responsible manner. Most of them would expect at least 12 months of consistent payments on at least two to three accounts, this is also called trade lines. This is expected from the discharge date of the bankruptcy. It is only upon seeing this would they consider granting the loan. Steps You Can Take If Your Credit Is Not Worthy Enough For Refinancing If your report display further negative occurrences apart from medical (since many lenders will overlook medical) you might want to think about using an established credit repair company to get the unfavorable items taken out before you apply for the refinance. Your search for a reputable company should not be taken lightly and you should pick one that has a good track record and can display evidence of their success rate with past customers. It is easy to get taken in by the wrong company so do your research in advance. What Credit Scores are Needed to Refinance with Damaged Credit? As the market is ever in flux I have found a few lenders now prepared to do refinances on damaged or dinged credit with scores as low as 530. These, generally are FHA loans for primary residences only. Credit scores of less than 580 require a larger down payment for purchases and refinances are limited to a lower loan to value. Usually lenders expect the borrower to have a few months reserve payments set aside (mortgage payments must include taxes and insurance). This will help to ensure that the mortgage companies do not make getting out of your fix any worse than it needs to be.

Call Realtor Agata Grudzinski @ (850) 708-7724 for Property Details.