The last few years have been difficult and many have had to face very difficult financial decisions. Once you realize that money is going out faster than it is coming in, you know you are in trouble. Many individuals have been left with a decision of either filing a bankruptcy or letting their home go into foreclosure. These are life changing events and not for the better, at least initially.
Just because there was difficulty in the past, it doesn't mean these individuals will never be able to purchase again. It just means that they will have to take time to rebuild their financial lives and their credit. A public record, such as a bankruptcy or foreclosure can negatively impact an individuals credit score by 100-200 points. To rebound from that amount of point loss, will take time. In most cases 3 years after a foreclosure, 2 years after a Chapter 7 Bankruptcy for a new FHA mortgage.
Once you are ready to make another purchase, it is important that you disclose either the bankrupcy or foreclosure through the declarations made on your mortgage application even if it does not appear on your credit report. The one thing you MUST remember, is that these are public records and this is something that is going to be checked during the mortgage process. If you fail to disclose this information and it is discovered through the verification process, it will result in a DENIED Loan.
For more information regarding rebuilding your credit after one of these events, please give me a call.
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