Jump to Navigation

How Can We Help You?

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Rebuilding Credit: Getting a Mortgage after Bankruptcy

Bankruptcy is a way for struggling borrowers to get a fresh start. Qualifying borrowers can have debt forgiven (discharged), reduced or consolidated into affordable payments. Despite the negative impact a bankruptcy can have on a credit score, there are things that can be done to assist with purchasing a home and getting a mortgage after a bankruptcy.

Most borrowers find that they may be eligible to apply for a mortgage with one to four years depending on the type of bankruptcy that is filed. FHA or VA loans are available two years after a Chapter 7 bankruptcy discharge and conventional financing available in about four years. For Chapter 13 cases FHA or VA loans are available in one year and conventional loans in two years.

Improve Your Credit

There can be hurdles when someone who has filed for bankruptcy wishes to apply for a mortgage. Credit will be scrutinized by the lender. One way to help with improving credit is to make sure all bills are paid timely. In some cases it will help to establish a credit card, particularly a secured credit card, as a way to rebuild credit. A secured credit card is extended to people who put a certain amount of funds on deposit at a bank. The bank issues a credit card with the amount on deposit as the credit limit.

Individuals who have completed bankruptcy can improve credit by ensuring that all rent and utility bills are paid on time. The payment of monthly bills can affect how lenders view a borrower's financial responsibility. Lenders look for a pattern of responsibility as a way to determine good credit.

Co-signed loans may be another option to help improve credit and credit scores.

There are also loans offered that are insured by the Federal Housing Administration that allow private lenders to offer mortgages to people with poor credit.

Start Saving Now

One thing that will tremendously help those who have gone through bankruptcy and apply for a mortgage is to save, save, save. Lenders will view borrows more favorable if they have money for a down payment which will improve the loan to value ratio. It is recommended that somewhere from five to 10 percent of earnings be put into savings. This will also help borrowers establish a budget and aids in calculating how much of a monthly mortgage payment one can afford.

Reach Out for Help

Chapter 7 and Chapter 13 bankruptcies are important tools that can be used for personal debt relief. An experienced bankruptcy attorney can help explain the best option for those facing insurmountable debt and offer guidance through the process.