With a bankruptcy against me, is buying a home simply out of my reach?
i have been looking at the foreclosed homes in my area, and there are some outstanding deals out there right now.
i have made some terrible decisions in my past regarding my credit, and after living and learning, i wonder how often, if at all, lenders are willing to give second chances this early in the game (i filed in ’06).
should i just stop looking at these homes and stop dreaming and face reality, or is there hope?
the reason i am looking into buying is because we have a child on the way, and our one bedroom, tub-less (we only have a shower stall) apartment is not going to cut it with the baby, at least not after the first couple of years.
he has a repossession against him, so neither of us have great credit.
should we just get accustomed to renting, or is there hope for us?
he works full-time making $13 an hour with overtime every week, and i work 2 part-time jobs. we have no other bills except electric and phone. our vehicles are paid off, we have no credit cards and no loans at all whatsoever.
i don’t know if i have given enough information, or if it just varies from lender to lender, or what. i will be a first time home buyer and so will he.
thanks in advance!
Sell House Quick
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March 27th, 2010 at 2:06 am
sorry but with the economy the way it is, probably not seeing as its only been about 3 yrs since you filed bankruptcy and now its even harder to get loans , plus what are you going to do when the baby comes? are you going to stay at home or work and put the child in daycare. Keep in mind a lot of these foreclosed homes were left with damages behind the majority of them at least. So you would probably have to make some improvements or fix up some things as well.
March 29th, 2010 at 2:28 am
1. It never hurts to ask a lender- all they can say is NO.
2. You need a good chunk of change to put down- do you have money saved?
3. Forecloses are like cheap Candies- they look a lot better then they taste and then you brake off a tooth. Our foreclosed seemed like a steal but $50,000 later in repairs… on top of the 102,000 selling price…. I am beginning to worry. Foreclosure are know for being ripped apart, treaty badly and destroyed. Did I mention they sold the copper piping and replaced with mismatch pipes and duck tapes… but hey it worked for a while and we didn’t realize it until the floor rotted away! Oh and no insulation in the whole house- another 8 grand.
Never buy a “project” unless you have cash to spare. We will be spending about 100,000 before it’s all said and done…….
March 31st, 2010 at 9:49 am
No a bankruptcy will not ruin your chances of home ownership, however, most lenders require that your bankruptcy be 2 years discharged before they will approve you. You might have filed in 2006 but when was it discharged or “approved” and recorded?
Now, with the economy the way it is, and the fact that all the banks made risky loans to people with no so great credit and they all got shafted in the process, home mortgage approval is going to be a lot tougher than a year ago. How is your credit now that you’ve had three years to recover from bankruptcy? Has your credit score gotten over 700? How is your husband or b/f’s credit score is he at least over 650?
chances are it won’t be the bankruptcy that holds you back it’ll be your credit score now, as long as all your bills are paid timely since your bankruptcy and your score is good then you shouldn’t have problems applying and getting approved for a mortgage. You probably won’t get a low interest rate and be prepared to get points on the loan, also be prepared to put no less than 20% down, no one is doing 100% financing these days, and they will need your FICO score to be at least 700, if you are over 740 even better.
Pull your credit from the three reporting agencies for free and see what’s on there and what you can clean up or have removed, that way you know where you stand. Then call mortgage lenders and see how much you can get approved for then you’ll know where to start.
You’ll never know if home ownership is in the future if you don’t ask a lender.
Good luck
April 2nd, 2010 at 3:23 am
Sadly for you, yes. Bankruptcy puts you in a high risk category. Most likely you would need a co-signer in order to get a mortgage. Your credit score probably won’t be 700 for a while. On your mortgage application one of the first questions they ask you is about bankruptcy in the last 10 years. If you do qualify, you will pay a substantial amount more interest than the rates you are seeing now, perhaps 8-9%. One can always find a lender but you want to get the best deal possible for you and your family.