Getting a Mortgage After Filing Bankruptcy In Las Vegas
Las Vegas Bankruptcy Attorneys Discuss The Facts About Getting a Mortgage After Declaring Bankruptcy In Nevada
When debt becomes too much to handle on one’s own, bankruptcy is there as a safety net. Bankruptcy offers tremendous benefits and protections, and allows those who use it to move forward with a clean financial slate. However, it doesn’t come without its drawbacks. Filing bankruptcy can have a significant impact on your credit, affecting your ability to obtain financing in the future. If you’re considering filing bankruptcy, but still have buying a home as a goal in mind, read on to learn more about getting a mortgage after declaring bankruptcy.
Am I Permanently Barred From Buying a House After Bankruptcy?
While you may find qualifying for financing after a bankruptcy discharge more difficult than before filing your case, you are only temporarily restricted from buying a home. You will need to wait two years after your bankruptcy to qualify for FHA home loans. Once the waiting period is over, you can apply for an FHA loan. As part of your application, you may be required to explain the circumstances that led you to bankruptcy. Working to rebuild your credit will improve your chances of approval after your bankruptcy has been discharged.
How Filing Bankruptcy In Las Vegas Impacts Your Credit Score
Bankruptcy impacts everyone’s credit scores differently. If you have a high credit score before filing your bankruptcy petition, you can probably expect your score to decrease upon filing. However, many people facing bankruptcy don’t have the best credit. Someone who files bankruptcy with a mediocre or low credit score may see no effect, or even a slight improvement. The chapter you file can also come into play. The long term effects of bankruptcy on your credit will depend on the steps you take to reestablish your credit after your debts are discharged.
Monitor Your Credit Report
Especially if your case was filed with a Las Vegas bankruptcy attorney , all of your debts should be seamlessly included in your creditor mailing matrix, and thus in your bankruptcy. However, every once in a while, a debt can slip through the cracks. This happens most often when the debt is newer, or comes from certain sources, and hasn’t appeared on the debtor’s credit report at the time of filing. Medical bills are often among these types of debts. If an unexpected debt from before your bankruptcy filing pops up after discharge, a few factors will affect how you should proceed. If you filed Chapter 7 bankruptcy, your creditor most likely would not have received payment in your bankruptcy. Unless this was a fraudulent debt or a debt that was nondischargeable for some other reason, this creditor doesn’t have a special right to payment over the rest of your creditors for debts discharged in your bankruptcy. In most cases, you can simply amend your bankruptcy petition to include this creditor, and the debt will be discharged with the rest. However, if this situation happens after a Chapter 13 bankruptcy, there is a better chance your creditor would have received payment. File your case with an attorney so you can be sure that your payment plan includes all of your debts and there are no issues in the future.
Even if you included all of your creditors in your bankruptcy petition, there could still be issues on your credit report. Make sure that none of your creditors have continued reporting to collections. Monitoring your credit for these types of mistakes will be an ongoing process while leading up to buying a home. If you retain any financed assets in your bankruptcy, it’s vital that you remain current on these payments. Missing these payments could hurt your credit score moving forward from the bankruptcy.
Rebuilding Your Credit After Bankruptcy
Regardless of if you discharge your debts in bankruptcy, it is helpful to take steps to improve your credit while preparing to buy a home. This can help you achieve a better interest rate and other favorable terms in your potential mortgage. Use any of the following to help you rebuild your credit after a Chapter 7 or Chapter 13 bankruptcy.
Financing a vehicle can help you boost your credit to prepare to finance a home. Making full and timely payments will create a positive credit history that future lenders can review before giving you a loan. However, if you have a financed vehicle that you retain through your bankruptcy, your creditor is no longer required to report your timely payments. Your lender can still continue reporting when you make late payments, so keeping the same vehicle only has the potential to hurt your credit score. You must trade in your vehicle in your bankruptcy if you wish to improve your credit with payments on it.
While credit card debt could have been a significant contributor to your need for bankruptcy, opening new credit cards after your case has been discharged can actually help improve your credit. Of course, making late and partial payments after your bankruptcy will still hurt your score. But making timely payments, and having more of your credit limit available, will have a positive impact. You will most likely receive several credit card offers in the mail after your bankruptcy is discharged. However, these aren’t guarantees for approval. Depending on your personal situation, you may have a hard time being approved for new lines of credit after bankruptcy. Or, you simply might not want to incur new debt right after discharging your old debt. Either way, you may want to utilize the option of opening a secured credit card with your bank. This is essentially a prepaid credit card that helps you build your credit without the risk of spending money that you can’t afford to pay back.
Raising Your Credit Score After Filing Bankruptcy in Las Vegas, NV
One way to raise your credit after bankruptcy that you may not have considered is with a bankruptcy payment plan. Many attorneys may advertise using payment plan options, only to inform you during your consultation that you will need to pay your balance in full before your case can be filed. When you’re fending off creditors, even possibly dealing with a wage garnishment, coming up with such a significant sum up front can be difficult. However, some attorneys offer true zero down bankruptcy payment plans. In this type of payment plan, you can pay for both your attorney’s fees and your filing fee in installments after your petition is filed. If your attorney offers a zero down payment plan, confirm that it includes credit reporting. If so, your timely payments will help improve your post-bankruptcy credit score.
Contact Our Las Vegas Bankruptcy Attorneys Today
Declaring bankruptcy is a serious decision that comes with significant advantages and disadvantages. This decision is best made when well-informed. To learn more about how bankruptcy will affect your financial situation, call for your free consultation with one of our bankruptcy attorneys. The dedicated staff and attorneys at Vegas Bankruptcy Lawyers offer reliable legal representation at fair prices.
We also offer zero down post-filing payment options. Contact us today to learn more about filing bankruptcy with no money down. $0 Down Bankruptcy. Call or use our online form to get started with your free consultation today.
Las Vegas Bankruptcy Lawyers