Buying a House After Bankruptcy

Document Sample
Buying a House After Bankruptcy Powered By Docstoc
					Buying a House After Bankruptcy Is
Many people have always been told that if a person files for bankruptcy their credit will be ruined, and
they will never be able to do things like buying a house. These statements are utterly and completely

The truth is that buying a house after bankruptcy is a possibility. When you have had a rough time
financially, and you had to file bankruptcy to get control of the situation, you did not do something that
marked you for life. A filing of Chapter 7 (the most commonly filed type of bankruptcy), only stays on
your credit report for 10 years after you file. Not for eternity.

Also repairing credit after bankruptcy does not have to wait for 10 years to begin. As soon as you have
resolved the issue that caused you to get into a bad situation with your finances, you can start to rebuild
your credit scores. You have a clean slate at this point, other than the bankruptcy is showing. So
rebuilding credit after bankruptcy is rather like beginning brand new, with no history of late payments,
repossessions, or defaults holding you back.

One of the first things you can do to get your credit restarted is to apply for a secured credit card. These
cards require that you send in the amount that will be your credit limit, usually around $250 dollars. The
credit card company keeps that amount, and you have a credit limit matching it. Every month the credit
card company will issue you a statement with a balance due, minimum due, and a due date just like the
unsecured cards do. You make the monthly payments on time, and the company reports how well you
pay to the major credit reporting agencies. After a length of time of payments the company may even
return your initial deposit amount, and switch your account to that of unsecured status.

Second you should apply for store cards. Store cards are only good in the store they are issued from,
and are therefore usually easier to obtain than other unsecured cards. Once again timely payments are
necessary to get that credit score started climbing upward.

Along with the cards you need to build some credit from accounts that are not revolving accounts. You
need to get a personal loan, or a loan for a car, and show that you can pay the loan off exactly like the
contract says. Try getting the loan from the bank you do business with, they already know you as a
client. When you do get one of these loans, do not just pay the monthly amount set. If the loan payment
is $233 then pay $253 each month. You will more than likely never miss the extra 20 dollars, but the
extra will be applied to the principal amount you owe. Therefore it will make your principal lower, so that
lowers your interest, so you look like you paid the loan off quicker.

Buying a house after bankruptcy is a possibility, if you keep moving forward with determination, from
the day you file.

Shared By: