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Bankruptcy is often a non-option for people who are planning to buy a house in the near future. While bankruptcy does not eliminate your chances of getting mortgage loans, it will undoubtedly make the process more difficult. So if you are planning to buy a house within the next two years or so, exhaust all other options first before you apply for bankruptcy.
Sometimes, though, circumstances force us to bite the bullet and take the last resort. If you have already applied for bankruptcy, then don’t lose hope – there are still ways to apply for and secure mortgage loans.
Experts say that your chances of getting home mortgage lenders to hand you money exponentially increases if you filed for bankruptcy under Chapter 13, but new trends in mortgage lending seem to indicate otherwise. Banks and lenders now seem to treat both Chapter 13 and Chapter 7 bankruptcy cases in the same way: they require a 2-year ‘probation’ period, and look at not just credit scores, but also regularity of income and capacity to pay for down payment.
And no matter what kind of bankruptcy is in your history, the same guideline applies: If you are a mortgage borrower with history of bankruptcy, you cannot just apply for a normal mortgage loan – instead, you have to go for specialized ‘bad credit mortgage loans.’ Read on for some tips on how to bag these special post-bankruptcy mortgage loans.
Tip #1: You need an expert to file for a mortgage loans after bankruptcy.
Applying for mortgage loans after bankruptcy is not as simple as applying for home loans under regular circumstances. You are tapping into a special area of lending, and you need the help of experts who have extensive experience with bankruptcy loans. There are complex laws governing bankruptcy which may not be readily understandable to a layman, so it is best to check with a professional (like a lawyer or broker, for instance).
Tip #2: Try refinancing.
If you have just gotten out of bankruptcy and want to immediately clear off your debts, then apply for a refinancing loan after bankruptcy. Many mortgage lenders provide this type of loan window. This tool will enable you to merge your debts into one bill, lower interests, simplify your monthly financial planning, and help you easily pay them off.
Tip #3: Shop around.
More and more financial services companies now offer mortgage loans after bankruptcy, so don’t rush into a deal until you’ve understood and compared them all. With the competition increasing, many lending companies now offer bad credit mortgage loans with comparatively good schemes to people who are just coming out of bankruptcy. Do not rush into a contract with the first lender you see. Research and explore the terms and interest rates offered by other lending companies, too.
Remember that bankruptcy is not the end of the line – you can still reclaim the confidence of being a fiscally-responsible member of society, and you can still qualify for major loans such as mortgage loans. There is no need to wait seven or 10 years – lenders can now accommodate you in as little as two years.
If you think about it, bankruptcy did not rob you of the chance to own a home. If anything, it taught you the value of handling money well, and has brought you closer to that dream. | 
