We are going to make ourselfs bankcrupt but worried we won't be able to get a house afterwards any advice?

Answer 1

My sister and her husband filed for bankruptcy. After 2 years they were able to get a home mortgage. But keep in mind, you have to start working towards it way before the 2 years is up. They had to open 2 lines of credit. Credit cards are easier, because you can do a secured card, or one with an annual fee. But these cards had to be used on a regular basis to show payment history. What they did was use the cards every month to buy gas or groceries and then pay them in full when the statement came in. The last thing you want to do after a bankruptcy is to get into debt again, so be very careful with any cards. Then about 6 months after the bankruptcy, they got copies of each of their credit reports to make sure anything on there that should have been on the bankruptcy is actually showing discharged. A mortgage company should be able to help you with that part. Other than that, just expect to have a high intrest rate on the mortgage. But you should be able to refinance after 5 years at a much better rate. Hope this helps.

Answer 2

I've worked for a number of years in the mortgage industry and at a mininum you must be discharged for at least 2 yrs (the more the better) from a BK and have NO DEROGATORY CREDIT since. This includes collections, major lates, judgements, liens etc. This is for conforming rates (what you hear about on TV etc.). To better your chances have 5-10% downpayment and reserves (retirement funds of leftover money after closing in checking/savings). Also a 20yr or 15 yr fixed will improve your chances through DU, what most companies underwrite to (fannie mae standards).

Subprime lending will allow financing 1 day after BK discharge, but typically financing will require 5-10% down (now that standards have been cut) and will be with a 2/28 arm with a 3yr prepay (if your state allows prepays). Your rate will be much higher under this scenario and a 2 yr arm requires a refi with additional closing costs all over again otherwise the recast of the loan will swell your rate up to 5-6% above market rates.

So yes you can get a home afterwards but I'd save for a downpayment in the 2-3 yrs before you realistically do it.

Answer 3

If you are UK go here www.insolvency.gov.uk. It is the government site and has lots of good advice.

After discharge of bankruptcy you will still be able to get credit - but at a higher interest rate. It will also stay with you for years and years. Don't do it if you can avoid it - and be careful about IVA's. They seem to make Insolvency Practitioners a lot of money but not much else.

Answer 4

Do whatever possible to avoid bankruptcy....Try and negotiate minimum payments with creditors... Bankruptcy is frown upon by mortgage lenders... Your chances of buying a home even 7 yrs down the line are slim to Nil...and even when granted a loan the interest rate will be outrageous it's not even funny. Hence, stay out of bankruptcy by all means...and learn that lesson well. Best of luck to you.

Answer 5

Most likely you will have to wait for 2 years. However, if you come in with a big down payment, you can get in a loan earlier. If you can fill BK on only one of you, that will help you situation in the future.

Answer 6

That is true. Banks are hesitant to lend money to people who have a track record of not paying their debts, especially since in PA, a person gets to keep their house and a car after declaring bankruptcy.

Answer 7

You'll have a very bad credit rating for years, and will have difficulty getting a mortgage.

Answer 8

Even after you have been finally cleared it will be hard to get anything even a Bank Account,
you will be left with the minimum to live on. its not good

Answer 9

u will get a mortgage after 6 years
save what u can during these years