Will I be able to get mortgage after bankruptcy?
I am considering personal bankruptcy to be rid of credit card debt of about $20,000. I`ve spoken to a trustee already and have been advised that this is the best option for me and that I certainly qualify.
That being said, my spouse and I are concerned that we won`t be able to get a mortgage which we will need to get in 18 months from now.
My spouse will probably not qualify on his own. I`m thinking that if I am going to a lender `debt-free` and can demonstrate an ability to make payments to a mortgage (and note that we will have equity already in the home that we purchase) that we should be ok.
Am I wrong? I guess I`m not sure how the traditional lenders view a bankruptcy on someone`s file.
I will plan to get a secured credit card asap to start repairing my credit rating.
If you currently have a mortgage and you do not have any payment problems during or after you bankruptcy then you should not have any problems renewing your mortgage in 18 months. You may not qualify for the “best” interest rate, but you should be able to renew.
If you are searching for a “new” mortgage then 18 months probably isn’t a long enough period of time to re-establish your credit history after bankruptcy.
I suggest you contact a couple of mortgage lenders BEFORE you file and discuss what you need to do in order to qualify in the future. If you start working with some one now you should have a better chance of being approved later.