A Few Helpful Tips on How to Buy a House After Bankruptcy
For those who have recently gone through a bankruptcy, there is some good news – you can still buy a house, but you will likely need some sources of financing to be able to do so. Not all is lost, there are still things you can do – learning how to buy a house after bankruptcy in large part has to do with learning how to make the necessary financial arrangements. Having bad credit makes your income verification and down payment more important than these factors would be for person who have good credit.
You Must Wait Two Years Following Bankruptcy
Lenders will typically require you to wait for at least two years after filing for bankruptcy before allowing you to apply for a mortgage. After these two years is over, home financing should again be relatively easy to obtain.
Your credit history will of course be checked to ensure that any payments made after the bankruptcy have been in full and on time. If a debtor wants to get a mortgage before these two years are over, they will have to have a spotless payment record from their bankruptcy onwards.
The secret of how to buy a house after bankruptcy is having a good track record of making payment sin full and on time since the time of the bankruptcy proceeding. If the debtor is able to make the down payment, usually between three and five percent, this will help them to make their case that they are credit worthy enough to receive a mortgage.
When pondering the question of how to buy a house after bankruptcy, there are other options open, such as borrowing from relatives. Having financed the purchase in this way, one can later go and take out a second mortgage to cover the total value of the home and then pay back relatives. You should be honest about the source of this funding, lest you be suspected of trying to defraud the lender.
Another answer to the riddle of how to buy a house after bankruptcy is payment assistance programs like the Nehemiah program and Neighborhood Gold. These help debtors to work with sellers on down payments. You can legally receive your down payment from these sources, but not from the person selling the home.
Another solution to how to buy a house after bankruptcy is cashing in an investment such as a 401K and replacing the money in this account by means of a second mortgage later. Mortgage loans, even for people who have declared bankruptcy are indeed possible and there are bad credit mortgage lenders out there who can help you to own your home.