Mortgages After Bankruptcy

Mortgage debt problems can be stressful, but so is losing a home to foreclosure. For many people who have suffered financial hardship, bankruptcy offers a way to resolve debt problems and regain control over their future. When it comes to mortgages after bankruptcy there are some things that your Elk Grove bankruptcy attorney can tell you about how to secure a mortgage after a fresh start.

Mortgages After Bankruptcy

The first thing to know is that time heals, especially when it comes to your credit. You should wait at least a year or two before attempting to apply for a mortgage after a bankruptcy filing. This provides time for you to work on rebuilding your credit and prove to lenders that you are not a borrowing risk by establishing a solid payment history on credit accounts.

Next, start the planning process early. While you are working on your credit profile you can also start saving for a down payment. The more you can offer to put down at closing, the more likely a lender is to see you as a favorable borrower. Work towards saving 20% of what your loan is going to cover at closing before applying for a mortgage loan.

When your credit standing has been repaired and you have saved enough for a sizeable down payment, shop lenders. Just because you have filed bankruptcy in the past does not mean that you don’t deserve a good loan with favorable terms. Since not all lenders are equal, speak to several different companies and find out what they are willing to offer you. Compare your mortgage offers and look for the one with the lowest, fixed interest rate with the best conditions.