How To Buy a Home After Chapter 7
- 1). Focus on the positives. Your bankruptcy is actually an asset to you, because under Chapter 7 you were able to discharge most or all of your previous debts. This means you will have few monthly payments to make after your bankruptcy, which frees up space in your budget for a mortgage. Begin saving money for a down payment, and after two years your credit should have healed to the point where you can be approved for a loan.
- 2). Repair your credit report. If you want to get a home loan, you need to keep your credit report clean after your bankruptcy. Check your report regularly to be sure that none of your old debts are still showing as unpaid; once your debts have been discharged, they should not be reported as open debt on your credit report. Call your creditors and ask them to report to the credit agencies that your debt has been discharged.
- 3). Rebuild new credit. Try to get a credit card after bankruptcy, but be careful how you use it. Pay off your bills on time, and do not overspend. You need to have credit to get credit, so having a credit card (even if you have to secure it first or pay a high interest rate) will help you rebuild your credit score, as long as you use it responsibly.
- 4). Be patient. According to moranlaw.net, most people who file for bankruptcy can usually get a home loan similar to what they would have had before bankruptcy approximately 18 to 24 months after their case is discharged. In that time you can save money for a down payment, clear out your credit report and show a history of paying bills on time. When you apply for your home loan, all of these things will work in your favor.
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