Discussion: Can Bankruptcy Filers Get Home Loans

[SinkingFast]

We filed Chapter 7 in 2001 and was dichared in July of that year - we were able to buy a house in 2/04 - so just over 2 1/2 years after filing a chapter 7 - we got a fairly good interest rate - just .25% above what everyone else was getting...

we kept our credit spic-n-span - no late payments - we took out 2 small credit cards and kept them paid off after charging small amounts

we have a conventional loan - to avoid PMI... FHA would have required PMI which would have tacked on a couple hundred to the monthly tab.

We are in 13 now because of the house - LOL - ironic huh? We are perfect examples of how life can bite you in the butt - even being perfect angels w/unsecured debt!!

A

Anj,........

We've owned 3 homes and all 3 ate us alive.

The first one cost us our butts. We walked in with a $10K down payment, paid all our costs, and had a conventional 80% mortgage. When we sold, we sold at a loss and walked out with $1500 cash left.

Second house we lived paycheck to paycheck the whole time. Had to replace the heat pump and the lateral field for the septic in only 4 years owning the place. We sold it for $17K more than we paid. But when you take out what we spent in repairs on the place, we didn't even clear $10K.

Third house was "The Money Pit". Not repairs. The house was well built. Costs to live there were something else. Electric was higher. Payments were higher. Taxes were higher. Had to buy a tractor to mow the place. CC debt climbed the whole time we were there. Several years ago, we had pretty well maxed out all the CC's so we refied the house and rolled all the debt against it. We went with a traditional 80% plus a HELOC on a super inflated appraisal. The debt started climbing again, hubby got laid off, we relocated due to new job, and the house will be going back to the lender cause we can't sell it.

I don't know if I will ever care to own another house again. After 20 years of houses owning me, I'm a bit tired of it all.

[Anj]

We bought the house in 04 - I lost my job later that year, and I make about 10k more than my husband - so it was a devestating blow - I was out of work for 9 months!!!
We payed our mortgage every month (not on the 1st) - but we got the payments there before 30 days late. I didn't bother opening the mail - but apparently, they paid our property tax and were billing us and I wasn't sending enough in - needless to say - it caused us to get behind in our mortgage.

I don't think it's the payment per say - but just the fact that I wasn't responsible enough to open my mail (yup, I said it out loud) - we filed the 13 to save our house - 3 months behind on a 944/month mortgage has cost us over 10k in fees - can you believe that???

I am determined, sinkingfast, to save this house... it is soooo worth it to us - after our ch7 - this is heaven to us - and as long as we have our house, we don't care about a new car or nice clothese or plasma screen tvs - a great house (to us) and AAA rated schools for our kids - that's what matters to us. The next 3 years are gonna be tuff, but having been through a 7, I know there is a light at the end of the tunnel.

A

[bkfiler]

you find stuff all over the internet and wonder what bias they have. i wonder if lenders really care if you filed a chapt 13 or chapt 7 just because you paid some money back.

[bkfiler]

lendor quote - There are, however, some things you must do to be able to get a mortgage loan at the prevailing rate. You must have re-established credit and have no other late payments or collections on your credit report. You also will have to give a detailed explanation about why you went bankrupt, and show that you have made some serious changes in the way you handle your finances. Due to changes in the law, however, you will have to wait four years to get a conventional loan.

is that true? do you have to explain why you went bankrupt.

what is a conventional loan? would i really have to wait 4 years before i get one?

[bkfiler]

lendor quote - Lenders vary as to what they consider to be a qualifying ratio, but it's safe to say that if your debt/income ratio is under 20%, your mortgage application won't be declined because you're trying to buy a house you can't afford. Most lenders will allow a borrower to spend up to 28% of his/her/their gross income for housing expenses, which includes the mortgage principal, interest, real estate taxes, and homeowners insurance.

$0 annually * 28% = $0 toward housing

guess i do have to get a job to buy a house.

[twv706]

For information on homeloans and bankruptcy I have created a page at http://www.mortgageawareness.com/credit.html