ABSOLUTELY! While the rules have changed drastically with regard to mortgage lending, bankruptcy and foreclosure are not the end of the world. Granted, there will be a time of recovery, and during that time, you need to rebuild your credit. I know I am stating the obvious, but the key here is documenting what happened, proving your ability to be financially responsible by paying a monthly housing payment (very often rent, but don't get discouraged yet), and waiting until the marks are far in your past.
Now, here is the good part. While you won't be able to qualify for bank financing for some time, you CAN get a home after bankruptcy or foreclosure under the right circumstances and here is what you need to look for.
1. Owner Financing. There are lots of investors out there that are desperately seeking renters and many will offer creative financing.
2. Rent With Option to Buy. This is a great way to check and see if you want to live in an area or if the property is right for you. Price is usually not set up front - which can be good or bad depending on the market. A common practice is to pay aboe market rent and have a portion of that credited towrds your down payment.
3. Lease-Purchase. While this may require more of a down payment, it is a great option for establishing ownership. Essentially the home is yours with a pre-closing lease agreement. Just make sure the lease gives you enough time to recover which is usually 12-36 months depending on whether you have a Chapter 13 bankruptcy, Chapter 7 bankruptcy, or foreclosure - respectively).
Most of the time you will need to do your own research to find these deals. I recommend checking online sites like Craigslist and Backpage. Your local real estate agent may be able to help as well, although the owners may struggle with paying for their services.
In all cases you must beware that these folks themselves may be in a bad situation financially. You need to do some due diligence to make sure the home actually belongs to them (and that they don't just have a contract), or that they themselves are not in foreclosure. I have gotten the call where a tenant if forces out of their home because their rent money was going to other things besides the mortgage - it's not a fun call to get. I recommend talking to a local real estate agent or title company who can help you assess ownership and lien status.
To get the full scoop on financial recovery after a bankruptcy or foreclosure, I recommend getting a copy of The Bankruptcy Mortgage Book.
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