Buying A Home After Bankruptcy – How To Improve Your Chances Of
Getting Approved

After a recent bankruptcy, many people assume that purchasing a
new home is impossible No doubt a bankruptcy is extremely
damaging to your credit history, and most lenders are not eager
to loan you money or extend credit However, there is good news
for the millions of people who file bankruptcy each year
Contrary to popular opinion, homeownership after bankruptcy is
very attainable
Delay the Home Buying Process
Although it is possible to get approved for a home loan one day
after a bankruptcy discharge, financial experts, and mortgage
lenders do not recommend this maneuver You can expect to pay
ridiculously higher interest rates and fees immediately
following a bankruptcy
The key to getting back on track financially is establishing new
credit accounts However, it is wise to start with smaller
accounts, as opposed to a home mortgage These may include
accounts that you can pay in full each month For the most part,
you should delay the home buying process for at least 24 months
During this time, open new credit accounts and establish a good
relationship with your new creditors
Improve Your Personal Credit Rating
By opening new credit accounts and establishing new credit
relationships, you will boost your overall credit rating
Following a bankruptcy, most people have very low credit scores
A low credit score warrants denials for credit cards and loans
Moreover, a low credit score will forfeit the opportunity to
attain prime rates
During the two years following your bankruptcy, strive to
increase your credit score This will take time The best way to
increase your personal credit rating is to avoid paying your
bills late Furthermore, avoid too much debt Maintain small
credit balances, and try to payoff your credit card balances
each month
Make a habit of regularly monitoring your credit report It is
recommended that consumers attain a copy of their credit reports
about every six months As you open new credit accounts, and
maintain a good payment history, this will be noted on your
credit report If errors are present on your report, contact
your creditors and the bureau to resolve the inaccuracies
Using Sub Prime or High Risk Mortgage Lenders
A bankruptcy will remain on your credit report for approximately
ten years During this time, most lenders will not offer you
prime or low interest rates To avoid paying higher fees, you
must finance your home with a sub prime lender Sub prime
lenders specialize in high risk loans and mortgages Their goal
is to get you the best financing package for your circumstances

Tags | balances, bankruptcy, contrary, credit, Finance, history, personal, purchasing, relationship, result