Can You Still Get a Home Loan With a Divorce?
Owning a home still signifies the American dream; if you've had to file for Chapter 7 or Chapter 13 bankruptcy, even though, it might feel like that dream is out of reach. By filing for bankruptcy, your credit rating can be devastated. When mortgage lenders visit a low score and a bankruptcy on your credit reports, they're much less inclined to approve you for a home mortgage. Lenders view you as a high risk to default on their loans. You may be eligible for a house loan, even if you have a bankruptcy in your past. It simply needs a bit of work.
Wait at least three years after filing for bankruptcy. Bankruptcies will dramatically decrease your credit score as soon as you file. However, their impact lessens over time. The longer you wait after a bankruptcy to apply for a house loan, the negative pull the bankruptcy will exert in your credit rating. Bear in mind, Chapter 7 bankruptcy filings remain on your credit report for a decade, while Chapter 13 filings remain on it for seven days.
Rebuild your credit rating, beginning immediately after you declare bankruptcy. You rebuild poor credit by paying all your bills on time each month. It is also possible to boost your credit scores by opening new credit card balances or carrying out auto loansif you may get approval for themand making your payments in time.
Write a letter describing to mortgage lenders the reason why you dropped into bankruptcy and how you't because mended your financial manners. If you dropped into bankruptcy as a child suffered a serious illness that brought huge medical bills, explain this. For those who have not missed a credit or credit card payment, mention this, too.
Telephone a few mortgage lenders. Lenders throughout the country vary in their willingness to take on riskier borrowers. Explain to the lenders that you contact that you do have a bankruptcy in your past. Explain, too, the circumstances that contributed to it and the measures you't since taken to rebuild your credit.
Send your correspondence to the mortgage lender with whom you feel most comfortable working. Your lender will think about it while underwriting your loan program.