June 24, 2015
Buying a Home After Bankruptcy or Foreclosure
With thousands of people negatively affected by the financial downturn of the late 2000’s (remember how horrible the economy was in 2008?) the real estate community had to reassess and reformulate some of their ideas on financing individuals who have a bankruptcy or foreclosure in their past. Once upon a time, a bankruptcy or a foreclosure was the kiss of death if you were looking for a new mortgage. Today, however, it is possible to obtain a new home loan as quickly as two to three years after a bankruptcy or foreclosure. It’s true – buying a house is quite a different proposition than it was only a decade ago. If you’ve been struggling with an economic recovery of your own, don’t lose heart. We’re going to show you some ways to ease back into the housing market and re-establish yourself as a sound credit risk.
- Check your credit report after your bankruptcy is discharged.
- Because three years past your official date of foreclosure is the magic number, be sure that this date is accurate on all searchable records.
- Keep any existing loans current.
- Re-establish your credit with a secured card as soon as possible.
- Use this positive record to get your first unsecured credit card.
- Even if the interest rate is high, take out a loan on a big purchase.
- Beware of “zombie debt”.
- Stay on the job.
- Save, save, save!
- Once you’ve re-established a solid credit history, apply for an FHA, Fannie Mae or VA mortgage.