Obtaining Mortgage After Bankruptcy Not Impossible
Bankruptcy is the process you have to go through
to begin again. The first and important item is to rebuild you credit
rating. It is necessary to know how long your bankruptcy will appear
on your credit report. The bankruptcy will be on your credit report
for about 10 years. Although this sounds bad, it only takes about
eighteen months of on time payments to your creditors to re-establish your
credit. Just remember, it is possible to get good credit ratings
after a bankruptcy.
To help your credit ratings you need to
get a job, fulltime or part-time, it doesn t matter. Another way
to help your credit ratings is to get various copies of your credit report.
Go over them in great detail to make sure that they are correct.
You need to get rid of most of your credit cards. It is advisable
to have only one or two. If you don t have a credit card, try to
get one from a local bank or store. If you can t get a regular card,
try to get a secured card.
Now you are on your way to re-establishing
your credit, consider these ideas to help you stay on top. Keep open
communication with your creditors. If they are advised of your current
status they may have helpful ideas about repaying your debt to them.
Making a budget will help you effectively pay back debts. Another
good idea is to pay off your debts that have the highest interest rates
first. Re-establishing your credit rating is hard work but can be
done.
Most folks believe that after bankruptcy
obtaining a mortgage for a new home is impossible. This is not necessarily
the case as there are many lenders willing to take a chance on people once
the bankruptcy has been discharged. However, there are few steps that need
to be taken to improve the chances of a lender reacting favorably to the
applicant s credit history.
If the person filing for bankruptcy has
rewritten any loans such as an auto loan to keep the vehicle out of bankruptcy,
keeping up the payments on time will demonstrate an improvement on the
potential borrower s part about wanting to pay their bills on time. Additionally,
if any credit cards have been opened since bankruptcy discharge, making
sure they are kept up to date will also help the cause.
One of the main criteria lenders look
at for home loans is the borrower s debt to income ratio. Having recently
filed for bankruptcy the debt should be minimal. Going through the credit
report will show any debts that should no longer be listed and the process
of having them removed begins with a written request to the agencies to
do so. This process can be time consuming and often proof will have to
be provided as to the validity of removing any items from the report.
Even with an appropriate income to debt
ratio and a positive approach to keeping payments up to date may not be
enough for some lenders to issue a mortgage loan. By waiting a year or
six months following an initial rejection may vastly improve the chances
of success.
Author-Bio: Legal Helpers (http://www.legalhelpers.com)
is a debt relief agency helping people to file for bankruptcy relief under
the bankruptcy code. We're one of the largest consumer bankruptcy firms
in America offering great service and free consultations. Bankruptcy attorneys
answer the phones six days a week.
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