Buying a Home After Bankruptcy

Tip! Your creditors can not change their minds at a later date From the date of approval of your Arrangement all interest and charges are frozen. Unlike bankruptcy there is no advertisement of the IVA in a local paper.

If you're planning on buying a home after bankruptcy you'll want to read this article carefully.

Buying a home is probably the biggest purchase you will ever make. Having a bankruptcy on your credit report adds an extra challenge.

If you've read my book After Bankruptcy Credit Solutions, then know that many people who have had a bankruptcy apply for credit and loans the wrong way.

Mistakes in this arena can cost you $10,000s in extra interest and other finance charges. Let's look at an example:

You finally find the home you've been looking and the seller's asking price is reasonable. So you apply for a $250,000 thirty year loan to purchase the home.

You fill out a mountain of paperwork... sign here, initial here, sign here, etc. Then not to long after that the lender call you with great news - you've been approved!

But don't pop the cork on the champagne bottle just yet. Sure, you were approved but at what cost?

You were able to get a $250,000 thirty year loan at 8%. That means that over the life of the loan you'll pay $410,388.12 in interest.

What if you had been able to take specific steps to increase your credit score and shop loans - and, as a result, reduced interest rate by 1%. In that case you would end up paying $348,772.12 in interest.

The 1% difference comes out to $61,615.87! If you were able to achieve that by taking some very specific steps that would have been EXTRA money in your pocket!

What's the point of this example? You simply can't afford to get it wrong when it comes to buying a home.

First, if there was ever a time where it's critical that you've increased your credit score before shopping for a loan this is probably going to be it.

Tip! The final step in considering bankruptcy is to actually engage the services of an attorney. At this juncture, you attorney will prepare a bankruptcy petition on your behalf that will be filed in the bankruptcy court.

So you want to increase your credit score. By the way, if you're trying to qualify for a loan and time is of the essence there's a way to increase your score in as little as 72 hours!

Next, you want to have mortgage broker on your team. If you've had a bankruptcy they can be invaluable. But you don't want just any mortgage broker.

You need to interview a few and ask them some very specific questions. It's really important that you have the RIGHT mortgage broker in your corner.

A good mortgage broker will have access to several lenders and know which one is appropriate for your situation. They will also be able to walk you through the entire loan approval process.

Only after you have lined up financing should you begin to look for a home. Of course, you'll want to interview a number of real estate agents.

But what if you can't get approved for a conventional loan? Don't worry! There are a number of strategies you can use to purchase if you can't qualify for a traditional mortgage.

In fact with one of the strategies it doesn't matter if you have terrible credit or even if you are unemployed... you can still qualify!

Tip! Chapter 13 bankruptcies act as sort of a consolidation loan in itself. Because the debtor is making payments on the owed monies, it does not have such a bad impact on the credit reports. But the individual does not have direct contact with the creditors and payments are distributed amongst them.

This information is designed to provide only a general overview of the subject matter herein.

This information is provided with the understanding that neither the publisher nor author is engaged in rendering legal, accounting or other professional advice. If legal or other expert assistance is required, the service of a professional should be sought.

How To Recover Quickly From Bankruptcy. High Converting Guide To Recovering Fully From Bankruptcy And Bad Credit Rating.

Neither the publisher nor author shall be liable for any loss or damages, including but not limited to special, consequential, incidental or other damages, caused by the information contained herein.

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Buying a Home After Bankruptcy