One of the most common misconceptions about buying a house after bankruptcy is that it can’t be done. Or, that it has to be done after the bankruptcy is no longer on your credit report. This usually takes 7-10 years, depending on the type of bankruptcy you filed for. Fortunately, you can buy a home after filing for bankruptcy. But, there’s just a few things you need to keep in mind first.
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Understand Your Waiting Period
While you don’t have to wait a decade to get a home loan after bankruptcy, depending on which type of loan you get, you’ll have to wait at least a couple years. Generous loan programs like FHA and VA only require a two-year waiting period. On the other hand, Fannie Mae and other types of mortgages require a four-year wait or longer. If you know you want to buy a home after a bankruptcy, find out how long you need to wait before you start house shopping.
Understand What Your Home Budget Is
One of the most detrimental things to do when buying a home after bankruptcy is getting one that is out of your price range. Even if you qualify for a higher priced home, you need to be very certain that the mortgage payments, taxes, and insurance is something you can pay every month. Falling behind on your mortgage after a bankruptcy will cause your credit to take a huge hit. Coming back from a foreclosure is often even more difficult than coming back after a bankruptcy.
Get Your Credit in Shape
After declaring bankruptcy, it’s important to regularly monitor your credit while you’re rebuilding it. Getting a secured credit card and ensuring that you’re paying your bills on time is crucial, but you also want to be watching and making sure there are no other issues that pop up on your credit report that will affect your score negatively.
Contact a Tyler Bankruptcy Lawyer
If you’re struggling with debt and are considering bankruptcy, get the facts about how a bankruptcy will affect your credit, your day-to-day life, and your ability to purchase a home in the future before you file. Contact the Law Office of Howard Tagg today to set up an appointment for a consultation to discuss your case. Call now at (903) 581-9961 — we are available now to help you move forward.
