Q: How long after filing a chapter 7 bankruptcy and being discharged do you have to wait in order to buy a home. I keep getting different answers? – LaQuitta
A: There are a lot of misconceptions regarding Bankruptcy and buying a new home. You will actually be the most popular person after you file Bankruptcy. Why, you ask. Because lenders are aware you can not file another Bankruptcy for several years, so you will have to pay their debt. With housing prices at an all time low and Mortgage rates as well, one should explore this opportunity. The fact of the matter is you can actually apply for a mortgage loan the day after your Chapter 7 Bankruptcy is discharged. With as little as 15 percent down and closing costs, you can buy a home the day after a Chapter 7 or 13, if you have the income and are willing to pay the costs. However, you may be called into Bankruptcy Court to explain why you are all of a sudden able to obtain a home. Make sure you immediately inform your bankruptcy attorney your plans.
However, before you seek a mortgage lender, it is wise to first consult a bankruptcy attorney or attorney who specializes in real estate law. Just like a doctor, you do not want your dentist conducting brain surgery on your head. Same is with attorneys. There are many fraudulent mortgage lenders licking their chops when individuals with poor credit or recently filed bankruptcy walk in the room. Many often misrepresenting the terms or excessive fees for desperate borrowers with poor credit searching and bankruptcy clients. In addition, if a lender does not want to deal with you because of your bankruptcy, there are many who do, and we have a list of lenders that are willing to give you a chance. Your attorney can analyze and explain the details within the documents.
We always suggest waiting at least a year to put yourself in the best financial position and it will give you a better chance of obtaining better rates. Take 6 months to a year, and (1) pay all bills on time, (2) save as much money as you can for a down payment, (3) retain your job, and (4) give us a call or talk to your bankruptcy or real estate attorney and you will be ready to buy a home.
Good Luck and Happy House Hunting!