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Is it possible to get a mortgage after filing for bankruptcy?

On Behalf of | Aug 27, 2021 | Bankruptcy

You’re not alone if you’re a resident of Texas who has always wanted to own a home. However, if you have filed for bankruptcy, you may wonder if that dream is unattainable. It’s important to know how you can still secure a mortgage after bankruptcy.

Stay up to date on your credit report

After you have gone through bankruptcy, it will show up on your credit report for at least the next seven years. You can be in better shape by staying up to date on your credit report when you’re planning on getting a mortgage. Each of the three major credit bureaus, Experian, TransUnion and Equifax, allow you to obtain a free copy of your report annually, so it should be easy to stay on top of it.

Look through your credit report to see if there are errors. If there are some mistakes, immediately report them to the credit bureau so that they can be fixed or deleted. Remember that the better your credit score is, the better your chances at securing a mortgage.

Rebuild your credit

After bankruptcy, your credit will take a hit. This means you should work at rebuilding your credit so that you can improve your credit score. It’s easier to do this than you might think. Always pay your bills on time, and pay slightly more than the bare minimum toward your credit card debt. You should also keep your credit utilization ratio low, meaning below 30% of your credit limit.

If you don’t have a credit card, apply for a secured one. It allows you to control your credit line and works with a deposit of your own money toward the card.

Hold onto your job

Keep working at your current job even if you want to get a new one. It will help your chances of securing a mortgage, especially after bankruptcy. A longer employment history shows that you have stability and are a good risk for a mortgage.

Stay patient

It’s easy to feel impatient when you want to get a mortgage. However, it’s important to remember that all good things take time. If it’s been under two years since your debts were discharged through bankruptcy, you’ll have to wait a while longer before applying for a mortgage.

Following these tips will help when you’re aiming to own a home. Rebuilding your finances after bankruptcy will help you show lenders that you’re ready to take on a mortgage.

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