After you experience bankruptcy, it might seem like you will never be able to qualify for a home purchase again. You have low credit scores, a drained bank account and a low self-esteem. However, even though you will have challenges, buying a home after bankruptcy is still possible.
Lenders don’t only look at your credit score after bankruptcy. They also look at your income source, your ability to make a down payment and your newly established credit score. You do have to undergo a waiting period after you experience a bankruptcy that ranges anywhere from 1-4 years depending on the type of loan you had and what the circumstances were. It’s a good idea to rent a home during that time and focus on building up your credit score as much as possible.
The best ways to build up your credit after a bankruptcy are to apply for a new credit card, buy things with it, and make payments on time. Once your credit score is back up to par, you need to make sure that you have a big enough down payment and that you have a solid two years of steady employment. Otherwise, you will have a harder chance qualifying for a loan.
When you are solid with all of the above mentioned factors, it’s time for you to find a lender who can help you out. It’s always a good idea to mention that you had a bankruptcy in the past before he or she runs your credit report. This will explain any blotches on your credit report and will help the lender feel like he or she can trust you in all circumstances. You might have to visit a few lenders before you find one who will help you, but the point is that buying a home after bankruptcy is entirely possible if you work hard and are patient – it’s well worth it.