Getting A Mortgage After Bankruptcy
Being accepted for a mortgage and finally owning a home is what many people aim to achieve as early as they can in their career so that they no longer have to waste money each month on rent, and the mortgage will eventually allow them to have their own home and no more large monthly repayments. Early on in their career, people are often faced with financial difficulty and many people may find themselves bankrupt and in serious trouble.
Bankruptcy is the worst financial situation to be in, but many people do quickly manage to improve their situation through careful analysis of their finances and cutting back on unnecessary expenses. Although people improve their finances, bankruptcy will leave a very black mark on their credit rating and this will put a dent in their hopes to get a mortgage to buy a home.
Many mortgage lenders will never consider lending to anyone who has been declared bankrupt within two years of the bankruptcy. Any lender that will lend the money will more than likely lend with a much higher rate of interest than what is available for people with better credit rates.
Mortgage lenders will most likely require a complete and faultless history since any bankruptcy in order to lend money to someone. If after bankruptcy you can show complete commitment to your finances then after the two year period there is a very good chance that you can get a mortgage, and hopefully the interest rate will be an acceptable one.
People who manage to save a large down payment or deposit on a property are always more likely to be accepted for a mortgage and this is also true for people who have been declared bankrupt. In fact, having a large deposit or down payment available may actually give you a lot more options in getting a mortgage within two years of the bankruptcy.
The most important thing to ensure is that you prove you can live within your means and still pay mortgage payments. Anyone who can’t do that should really be looking to either improve their income or clear any outstanding debts first. It’s important to remember that many people do recover from bankruptcy, and they often go on to be a lot more financially stable because of it.