Home Buying

[DWhittles]

What can you guys tell me about the process of buying a home after filing for a bankruptcy? We filed about 3 years ago. I'm so tired of moving, I'd really like to put my roots down SOMEWHERE.
Thanks,
Diana

 

[sweet angel]

I can wish you luck. Don't bankruptcies follow you for like 10 years? I'm sure someone will give you a loan, but it will much higher interest...especially if your credit is less than excellent and you have little or no down payment.

Don't get discouraged though -- there's always a way. Check out the FHA program.

 

[DWhittles]

I can wish you luck. Don't bankruptcies follow you for like 10 years? I'm sure someone will give you a loan, but it will much higher interest...especially if your credit is less than excellent and you have little or no down payment.

Don't get discouraged though -- there's always a way. Check out the FHA program.

I think it's 7 years and we've put it off and put it off beacuse of the bankruptcy but now that I have my two little guys, I'd really like them to have some stability in a good community.

 

[Alicnwondrln]

theres a great forum called creditboards.com

my friend filed 2 years ago they just bought a house
the cleaned up there credit reports, rebuilt credit
got a rate of 6 or 7% i think to start
they were happy with that
they put down 15%

 

[sweet angel]

I think it's 7 years and we've put it off and put it off beacuse of the bankruptcy but now that I have my two little guys, I'd really like them to have some stability in a good community.

I totally understand that and wasn't trying to be negative -- just realistic. I bought a home as a single mom 5 years ago. Hardest thing I've ever done and best investment. I used FHA and then refinanced to conventional.

 

[Aidensmom]

You will get a loan from someone, though it could be at a higher interest rate. A house can be foreclosed on and taken by the bank, so it is not as much risk to give someone with a bankruptcy as something like a credit card is.

As far as the interest rate you get, a lot of it depends on what the rest of your credit report looks like. I filed about 4 years ago for bankruptcy because after a divorce and major medical problems. Up until the point I filed, I made regular payments on the things that get reported on your credit report, such as car payment, credit card bills, etc. After the bankruptcy, my credit has been impeccable, never a late payment on anything. Three years after the bankruptcy we bought a house. Because, despite the bankruptcy, my credit score was not too bad, we still got a great interest rate on our loan, better than some other people I know that were buying a house during the same time period.

The main thing you need is a down payment. This is going to affect your interest rate too. The more you have to put down, the better shape you will be in.

 

[bjgrazi]

It hangs on your credit report for 10 years. You'll get a loan, but it's harder and a much higher rate. The more you can put down, the better off you'll be.

 

[Poohnatic]

There was a great article in the Washington Post about getting mortgages a few years ago.

Bankruptcy will mean a higher interest rate and you will have to put up a much larger down payment.

Get copies of your credit reports. www.myfico.com is a good start. If your score is under 620, it will be extremely difficult to get a mortgage, unless you want to pay usury interest rates (18% or so).

If you want to buy, get those reports NOW. Fix what you can. Save EVERY extra penny you can, because that bankruptcy will require it.

Suzanne

 

[Southern4sure]

What can you guys tell me about the process of buying a home after filing for a bankruptcy? We filed about 3 years ago. I'm so tired of moving, I'd really like to put my roots down SOMEWHERE.
Thanks,
Diana

I do not have answers for your question but I wonder why your tired of moving. How often do you move and why? Is it because of the bankruptcy? I would think rather you rent or own as long as you dont move every 6 months (an example) you can put down roots anywhere.

 

[Michie]

Moving alot if you rent will aslo raise a red flag for some loan companies, so keep that in mind. They want stability in a person's job, etc.

 

[Texan Mouseketeer]

I had a bankruptcy and my DH didn't, so that helped. We did a combo loan - one big loan for a 6% interest rate and a loan for $14000 of the home for 8%. That gave us some pretty decent payments that way.

One thing that helped get my score back up was to get a credit card. Yes, it was one of those bad ones with a huge initial fee and a monthly fee, but once I got it, things got better. I kept the limit down and only charged every once in a while and paid it off each month. Then, when I got the mortgage I cancelled it. Now, I get offers for anything and everything and it has only been 4 years since I filed...

 

[Aidensmom]

Just wanted to add to my earlier post because some of the other posts don't sound real encouraging. Again, I had a bankruptcy 4 years ago, and bought a house a year ago. We also had moved 3 times during the 3 years since I had filed bankruptcy. I have a 5% interest rate on my home, and I got down payment assistance for a FHA loan which requires only a 3% down payment in the first place. We only paid a small portion of the down payment and the closing costs. It can be done. Like I said before, and so have some other posters, the rest of your credit report is really important. Get a credit card, even if it is a secured one, make small purchases and pay them off. Pay everything on time. If your credit score is good, the bankruptcy is hardly even looked at. (I also at this point have 2 regular credit cards, one with a $5000 limit and whose limit just got raised to $10000 this week. Don't get discouraged just because you have a bankruptcy.).

 

[DWhittles]

I do not have answers for your question but I wonder why your tired of moving. How often do you move and why? Is it because of the bankruptcy? I would think rather you rent or own as long as you dont move every 6 months (an example) you can put down roots anywhere.

Okay,
here is the whole saga...
When we got engaged, we moved to Brooklyn and loved the apartment but it was infested with roaches and after a year, we had to leave. We moved to a townhouse in Piscataway NJ and my husband was really unhappy there so after 2 years we left. We found a great place in Hoboken that was a 2nd story walkup. I got pregnant with PJ and realized I couldn't carry a stroller up 2 flights of stairs so when PJ was about 4 months old we moved again. We actually moved directly across the street to an apartment on the first floor. Great building, found out I was pregnant with Brian and then the landlord tells us that he's either selling the building or tearing it down and we would have to go month to month on our lease.
Our lease was up April 30th and I was due with Bri May 6th. There was no way I was moving that close to my due date so we moved again back to Brooklyn April 1st.
PHEW...None of our moves was beacuse of the bankruptcy, but more beacuse of circumstances.
We are looking to move once again beacuse you really need a car where we are. I can't walk anywhere to do shopping and I'm really isolated.

 

[swilphil]

Just a word of caution. Make sure before you buy that your job situation is secure and something you want to stay with. If you are moving to a new area, it might be best to rent for a while until all your ducks are in a row.

 

[DWhittles]

Just a word of caution. Make sure before you buy that your job situation is secure and something you want to stay with. If you are moving to a new area, it might be best to rent for a while until all your ducks are in a row.

Yeah, we were discuss that last night (In the dark since our area had no power) and I think we might find a place to rent at first and be sure we really like it there.
However, EVENTUALLY I'd like a place to call my own...

 

[LindaR]

As a former mortgage loan officer, one thing that hasn't been addressed.......have ALL your bills, rent, etc. been paid on time since the bankruptcy? If you have lates showing on your credit report AFTER you've filed, that shows that you are irresponsible and are not improving your credit worthiness. If a person doesn't have things like car payments or credit card payments after filing, then banks look at utility histories and rent histories. I will also tell you that your banker will have heard every possible story (excuse) in the world, so save your breath. The proof is in the credit report.

 

[DWhittles]

As a former mortgage loan officer, one thing that hasn't been addressed.......have ALL your bills, rent, etc. been paid on time since the bankruptcy? If you have lates showing on your credit report AFTER you've filed, that shows that you are irresponsible and are not improving your credit worthiness. If a person doesn't have things like car payments or credit card payments after filing, then banks look at utility histories and rent histories. I will also tell you that your banker will have heard every possible story (excuse) in the world, so save your breath. The proof is in the credit report.

Absolutely. All my bills are always ontime if not early and always in full. That's good to know though

 

[LindaR]

Another thing a banker will look into is what sort of things were included (charged off) in the bankruptcy and WHY you filed.

In my opinion (freebie, here!) you are not stable enough to purchase a home.

 

[C.Ann]

We are looking to move once again beacuse you really need a car where we are. I can't walk anywhere to do shopping and I'm really isolated.

--------------------
I'm totally confused now.. How can you be considering a move to Vermont and not have transportation to get around? Did I miss something somewhere?

 

[tekmom]

Hi, if you are really interested in home ownership, you should make an appt. with a reputable lender and have them take a look at everything, from your credit, income and employment. we went about 6 months before we started looking at any houses. In the tri state area, there are MANY predatory lenders and unfortunately you will get a mortgage, whether you can afford it or not. When we bought 7 years ago, mortgage lenders seemed to be under much stricter guidelines.... we busted our butts to keep our credit perfect and to save for a down payment. Now, it seems as if anyone can get a mortgage. Start saving, know your credit score and keep steady employment. Be very careful....you know what you can comfortably pay each month on a mortgage. I know many people that bought within the past 2 years, that are now complaining that they can barely make the payments, even though they knew they would have a VERy hard time making them when they got the loan. Now, they blame the lender. Set a timetable, save money, know your credit score and do research. Best of luck to you and you family!