The Truth About Bankruptcy Mortgages [mortgageapproved.blogspot.com]
Leahcoss.ca Hi, everyone! How are you? It's Leah Coss with the Mortgage Center. I wanted to get a very common question out of the way real quick for you guys. And that is I've had a bankruptcy in the past, can I ever get a mortgage again? Quick answer, absolutely! Now, if you come to me and you say, "I have two previous bankruptcies." Well, now we're real limited but does that mean you cannot get a mortgage? Absolutely not! You can still get a mortgage, you just simply have different requirements than the average Joe. So, to quickly go through bankruptcies, if you've had a bankruptcy, not the end of the world. And no, it is not the seven year rule of bad luck where you cannot get any debt given to you ie lines of credit, credit cards, mortgages, things of that nature, car debts, car loans. You don't have to wait seven years before you can get that. You can get that right off the bat sometimes for some of those types of lending, OK? Obviously you can't get a mortgage right off the bat but you can get things like credit cards, whether it be unsecured or secured, it just depends on the person and what your situation is exactly. But from the point of discharge you can be getting a mortgage, a regular mortgage, meaning from a regular lender, this isn't talking about private. A regular mortgage in two years, OK? It's not seven years. The thing is though, if you want to be able to buy within two years of your discharge, you are going to have to find someone like myself or ...
mortgageapproved.blogspot.com Bankruptcy? Yes, You Can Get a Mortgage
What is a Bankruptcy Mortgage?
A bankruptcy mortgage is a mortgage application for people who have declared themselves bankrupt in the past. While turning to bankruptcy or individual voluntary arrangements may be the only way to get out of debt for some people it leaves a bad mark on their credit rating: a bankruptcy mortgage is aware of the borrower’s credit history but is willing to lend them the money under certain circumstances where they would be refused by a standard mortgage.
When it comes to Bankruptcy mortgages and financing, those who have become Bankrupt through lack of mortgage funds may find that the picture is not as bleak as it was 10 years ago. In the past many lenders stopped debtors from borrowing for up to 7 years after Bankruptcy. Today, due to lenders specialising in adverse credit, borrowers may still be able to keep their home even if they have considerable arrears. However, even the most specialised Bankruptcy Mortgage lender will apply restrictions to Bankruptcy mortgage refinancing, in order to make sure they are covered if the lender cannot pay.
What are the differences between a Bankruptcy Mortgage and a Standard Mortgage?
A bankruptcy mortgage is higher risk than a standard mortgage because it is designed for people who have had financial difficulties in the past. As such it is called a sub prime mortgage and is only available from specialised lenders, although the number of companies offering mortgages for individuals with adverse credit is growing. Currently there are around 30 lenders that offer bankruptcy mortgage services according to research done by the Council of Mortgage Lenders (CML). The rates for a bankruptcy mortgage are likely to be a couple of percentage points higher than a standard mortgage but individual case history and the circumstance of your debt will be considered.
How soon after Bankruptcy can I apply for a Mortgage?
Usually bankruptcy lasts for a year, therefore after this time you can apply for a mortgage although whether or not it is granted will depend on your credit record and the circumstance. Bankruptcy will stay on your credit record for six years. Usually individuals will have to show evidence that the circumstances that caused bankruptcy no longer apply.
Will getting a Bankruptcy Mortgage improve my credit rating?
Getting a bankruptcy mortgage is a good way to improve your credit rating if you have been bankrupt in the past, as long as you can keep up with your mortgage repayments you will be proving to future lenders that your financial management has improved.
Should I use a Broker to find a Bankruptcy Mortgage?
Bankruptcy mortgages are particularly specialist, therefore many firms that offer them only do so through a broker. Approaching a broker will give you access to a large amount of deals from a range of firms, because the rate you get quoted will depend so much on your previous case history going through an intermediary who knows the industry is the surest way to get a good deal and save you money.
What will I need to provide when applying for a Bankruptcy Mortgage?
When applying for a mortgage in adverse credit circumstances providing full details of your credit history is important, the more information you give the more they will understand your personal circumstances. You will also need to provide proof of your income. Before you approach a lender it is a good idea to think realistically about the amount you can afford to borrow and what monthly repayments you would be able to keep up with.
Increase your chances of success:
• Following bankruptcy keep your payments up to date and on time
• Put down a large deposit or down-payment
• Choose a mortgage lender who is FSA regulated and approved
• Get bankruptcy advice from an independent third party
• Use a broker or comparison tool to compare different bankruptcy mortgage quotes
