Getting approval on home loans after a bankruptcy can sometimes be hard to do. Bankruptcy is one of the biggest determining factors in several different stages of the loan process but when you know what to expect before it happens you can easily increase your chances of getting approval on the first try.
Many mortgage lenders require that you wait a given amount of time after your bankruptcy is discharged before they can give consideration for your loan request. The specific type of bankruptcy you filed for will determine how long you will have to wait of course. Chapter 7 usually requires a waiting period of t least two years before approval can be considered. In some cases you may be asked to wait up to four or more years depending on the lender you are trying to work with.
Chapter 13 has a waiting period of about the same length of time except for FHA loans where you could possibly be able to get financing as little as 12 months after you have filed for bankruptcy. The date you filed will be the final decision maker here as to just how long they will want you to wait of course. In order to do things this way you will need to get your trustee to approve you to add a new debt. Without this you will not have chance at getting loan approval.
The biggest problem most people encounter is the fact the lenders usually require you to reestablish your credit first. You can not have any negative accounts on your report since your bankruptcy either.
To reestablish credit history you will need things like a car loan or a credit card in good standing that has a balance below 10%. All home loans require credit to be reestablished before your loan can be approved.
If you absolutely want to avoid doing all of this than you ca of course choose to go with a non traditional type of loan. The downfall is that these loans have high interests rates and most often require a large down payment first.
Having to file for bankruptcy doesn’t have to mean you have no chance of ever getting a loan in your future. To overcome this you have to work hard to reestablish yourself and show the lenders it is a one time only issue and that there is zero chance of it occurring again.
To find the best home loan is much important. Here you can learn more about loans and read more here.