Buying A Home After A Bankruptcy With No Waiting Period

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Buying A Home After A Bankruptcy With No Waiting Period

This BLOG On Buying A Home After A Bankruptcy Was UPDATED On December 4th, 2018

Millions of Americans have filed bankruptcy due to being victims of the financial and real estate crash of 2008.

  • Never in history has bankruptcy filings hit historical highs
  • The subprime crisis and real estate crash of 2008 has changed peoples lives forever
  • Bankruptcy filings has hit historical highs  
  • Everyone knows of someone who has either filed bankruptcy or are in the process of filing bankruptcy
  • Actually, filing bankruptcy is a great tool for someone to start their lives over again
  • They do have to worry about past debt
  • Consumers don’t have to worry about dealing with debt collectors harassing them day and night
  • When someone files bankruptcy, all of their debts are eliminated
  • They can start rebuilding their credit and have a fresh financial start in life
  • Someone who has filed a Chapter 7 bankruptcy is eligible to buy a house in two years from the date of Chapter 7 discharged date with FHA and VA Loans
  • Home buyers can now qualify for VA and FHA Loans one year into a Chapter 13 Bankruptcy repayment plan
  • There is no waiting period to qualify for FHA Loans after Chapter 13 Bankruptcy discharged date via manual underwriting
  • Buying a home after bankruptcy is possible to all Americans with no waiting period now with the comeback of NON-QM Loans

FHA Loans After Chapter 7 Bankruptcy

Most folks who filed Chapter 7 bankruptcy do not realize that they can qualify to buying a home after a bankruptcy in just 2 years from the date of bankruptcy discharged date.

  • They qualify for FHA Loans:
    • They only need to put 3.5% down payment towards their purchase price
    • The balance is financed via FHA Loans
  • For those who filed bankruptcy and are considering purchase a home in two years, they need to start rebuilding their credit:
    • Never be late on their monthly debt payments

Re-Establishing Credit After Bankruptcy

Lenders will expect borrowers not to be late with any monthly debt payments such as credit card payments and automobile loan payments after bankruptcy discharged date. Cannot be late on any payments after foreclosure and/or short sale.

  • Most lenders will not approve for mortgage to anyone who had any late payments after bankruptcy and/or foreclosure
  • Credit scores will improve as time passes
  • But you should also start rebuilding credit by getting 3 secured credit cards
  • Why 3 secured credit cards? 
  • One secured credit card will improve score, two secured credit cards will improve it better, but 3 secured credit cards will optimize and maximize your credit scores
  • Have 4, 5, 6, 7 or more secured credit cards will take on the same effect as having 3 secured credit cards
  • Try to have the credit limits on secured credit cards no more than 10% balance of the credit limit and eventually reduce it down to a monthly $10 dollar balance on all three
  • The above tactic can improve credit scores by at least 70 to 100 points in a very short period of time
  • Never ever be late with any payments
  • Being  late with one payment after bankruptcy and/or foreclosure can jeopardize getting a mortgage

Add Positive Credit To Re-Establish Credit After Bankruptcy

Buying A Home After A Bankruptcy is not as difficult as most home buyers think.

  • Key is never be late with any payments after a bankruptcy, foreclosure, short sale, and/or deed in lieu of foreclosure
  • As time passes, the old negative credit items that was included part of the bankruptcy will have lesser of an impact on credit scores:
    • Eventually will be automatically deleted from your credit report
  • Derogatory items remain on credit reports for a period of 7 years from the date of last activity
  • Chapter 7 Bankruptcy will remain on consumer credit report for 10 years
  • Chapter 13 bankruptcy will stay on consumer credit report for 7 years

There is no waiting period to qualify for NON-QM Loans after filing bankruptcy. However, anywhere between 10% to 20% down payment is required. The down payment requirement depends on the borrower’s credit scores and the elapsed time after the bankruptcy. Contact us for more details.

To see if you can qualify for mortgage after bankruptcy, please contact us at 262-716-8151 or text us for faster response. Or email us at gcho@loancabin.com.

Related> Guidelines on mortgage after bankruptcy

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