Getting a Mortgage after Bankruptcy and Foreclosure

Mortgage after Bankruptcy and Foreclosure

It wasn’t so long ago that bankruptcies and foreclosures were reserved for people who made huge financial errors and couldn’t be trusted with a loan. That dishonor of a bankruptcy or foreclosure has gone down quite a lot in recent years because of the number of people who fell victim to unscrupulous housing practices.

Now, it’s common for people with solid jobs who are careful with their money to have a bankruptcy or foreclosure on their financial record because of the national economy and housing market crash in 2007. Over the past few years, banks have adapted the way they evaluate bankruptcy and foreclosure. This is why you need the experienced Orange County bankruptcy and foreclosure attorneys of McFarlin LLP on your side. We can be reached at (888) 728-0044 to discuss your situation.

How to Get a Mortgage after Bankruptcy

Here are a few tips to help you get a mortgage after you have filed for bankruptcy or a foreclosure in Orange County:

  • Keep an eye on your credit report. Make sure your credit report is accurate and all your debts have been closed and discharged as promised during the bankruptcy. Some creditors continue to report collections, which will negatively impact your credit score.
  • Check your official records. Make sure your foreclosure date is accurate. Lenders may approve your loan as early as three years after a foreclosure.
  • Keep making payments on installment loans. The debts you maintained after bankruptcy must be paid on time. Never miss a student loan payment or other remaining debt payment.
  • Reestablish your credit. It’s advisable to obtain a secured credit card as soon as possible. This will send reports to credit reporting bureaus that you are making payments. Make small purchases and pay them off each time your bill comes due. Don’t be afraid of high-interest credit cards, because they won’t affect you as long as you pay them off each month.
  • Before trying a home loan, try a smaller loan. Getting a car loan, for example, is much easier than a home loan. Making loan payments on time will help establish your credit. This will prove that you have either learned your lesson or that you can be trusted.
  • Keep checking your credit report. It’s common for collection agencies to re-open cases. You do not want an old debt to resurface and destroy your fresh start.
  • Apply for a Federal Housing Administration (FHA) Loan. After the proper waiting period is over, you will have a chance to apply for a home loan again. You may have to explain what happened and how you will avoid it again.

Contacting an Experienced Orange County Lawyer

Filing for bankruptcy or a foreclosure isn’t the end of the world anymore. You can recover and build again. If you are falling behind on payments and need help, contact an experienced Orange County bankruptcy and foreclosure attorney who will assess your circumstances and help you make the best financial choices for you and your family. McFarlin LLP can help.