Buying a Home After Bankruptcy Boston MA

It may seem as though you cannot buy a home in Boston after you have gone bankrupt, but this is not true. You can buy a home. In fact it may be to your best interest to buy a home because those who have experienced bankruptcy are actually encouraged to build credit by taking on debt.

James Mackenzie Wilton
(617) 951-7474
One International Place
Boston, MA
Specialties
Bankruptcy, Corporate
Education
Boston College Law School,Bucknell University
State Licensing
Massachusetts

Bruce Francis Smith
(617) 951-0500
1 FINANCIAL CTR
BOSTON, MA
Specialties
Bankruptcy
Education
Cornell Law School,Cornell University
State Licensing
Connecticut, Massachusetts, New York

Nathan Criticos Pagett
(617) 880-3489
Three Center Plaza
Boston, MA
Specialties
Real Estate, Commercial, Bankruptcy
State Licensing
Massachusetts

Lisa M Kresge
(617) 856-8234
1 FINANCIAL CTR
BOSTON, MA
Specialties
Bankruptcy, Commercial
Education
Boston University School of Law,American University
State Licensing
Massachusetts

Andrew Preston Strehle
(617) 856-8569
1 FINANCIAL CTR
BOSTON, MA
Specialties
Commercial, Bankruptcy
Education
Boston University School of Law,Massachusetts Institute of Technology
State Licensing
Massachusetts

Timothy Durken
(617) 856-8142
1 FINANCIAL CTR
BOSTON, MA
Specialties
Bankruptcy
Education
Vanderbilt University Law School,University of Massachusetts, Amherst
State Licensing
Massachusetts

Peter B McGlynn
(617) 790-3000
125 SUMMER ST STE 1300
BOSTON, MA
Specialties
Litigation, Employment, Construction, Bankruptcy
Education
Suffolk University Law School,University of Massachusetts
State Licensing
Massachusetts

Thomas H. Montgomery
(617) 856-8170
1 FINANCIAL CTR
BOSTON, MA
Specialties
Bankruptcy
Education
Boston College Law School,University of Pennsylvania
State Licensing
Massachusetts

Marc R Leduc
(617) 951-8891
150 FEDERAL ST
BOSTON, MA
Specialties
Banking, Financial Markets And Services, Bankruptcy
Education
Notre Dame Law School,Boston College
State Licensing
Connecticut

Nathan Criticos Pagett
(617) 880-3489
Three Center Plaza
Boston, MA
Specialties
Real Estate, Commercial, Bankruptcy
State Licensing
Massachusetts

Buying a Home After Bankruptcy

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It may seem as though you cannot buy a home after you have gone bankrupt, but this is not true. You can buy a home. In fact it may be to your best interest to buy a home because those who have experienced bankruptcy are actually encouraged to build credit by taking on debt.

It will not be easy, however. The problem is that these borrowers will be highly scrutinized, pay higher interest rates, and loans will come in smaller amounts because lenders will view them as high risk borrowers. These roadblocks should not stop someone who has gone bankrupt from buying a home, because taking on debt and paying off payments on time is the only way out of the downward spiral caused by a bankruptcy filing.

How Bankruptcy Will Affect Your Credit

Bankruptcy provides relief for people in poor financial straits. It is the last resort of action that will release them from their debts. However, a filing for bankruptcy will stay on a person’s credit rating for up to ten years, serving as a warning to anyone else who wishes to lend that person money.

This will cause any lenders to charge higher than normal interest rates in order to protect themselves from the likelihood that you will default. For example, an interest rate on an auto loan might normally be 6 percent, but for someone who has filed for bankruptcy, it might be 8 percent. However, as time goes on and payments are made on time, the filing for bankruptcy will become less important to the lender.

Rebuilding Credit after Bankruptcy

It is imperative that a good payment history is established after filing for bankruptcy. The following will help people who have filed for bankruptcy get back on their financial feet:

  • Pay bills on time. This is the best thing anyone who has filed for bankruptcy can do.

  • Use secured or unsecured credit cards and pay them off each month. Use them, but do not spend more than what you can pay off at the end of the month.

  • Read your credit report. Keeping up on your credit will keep you aware of your progress and any errors made by the credit company.

    When and How to Find a Home Loan

    Bankers and lenders want to see three things before lending money to a borrower following bankruptcy to ensure that the borrower is a good path financially:

    1. A two-year stretch of bills paid on time
    2. A down payment
    3. A steady income

    The biggest of these three things is a steady income. Some lenders, provided you can show that you have been paying your bills on time, will be willing to lend you money if they see that you have a steady flow of income. For example, if you have just come out of bankruptcy, but you have a small down payment and steady income, then it is not impossible for you to get a loan for a home right out of bankruptcy.

    Keep in mind that finding a good lender right out of bankruptcy will be difficult and may not be the best plan of action for the borrower. However, with a record of on time bills paid and a steady income, it is possible to get out of the proverbial hole bankruptcy has placed the borrower in.

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