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Many people have probably warned you that buying a home after bankruptcy is virtually impossible. They have probably told you that your low credit score will hinder you from qualifying for any mortgage loan. Well, get their voices out of your head because they are wrong. Buying a home after bankruptcy is not only possible – it has become easier, too. And if you know where to look and what to look for, the possibilities could be endless.
The good news:
Banks and home mortgage lenders do not only look at your credit score when they evaluate your application. They already know you are short in this aspect, because you have already applied for bankruptcy. What they are looking for are two other things which you have more control of: income verification and a down payment.
How to prove you have income:
The reason why most lenders require you to wait two years after you file for bankruptcy before they entertain your application is because they want to see your cash flow over this period: how you spend the money you have earned, if you have paid all your bills and debts on time, and if you have established a savings account.
If you are able to prove that you’ve become more responsible for your finances, you should be able to buy a home after bankruptcy. You will probably get a mortgage loan easily, and even get 100% financing as well.
Also, two years is usually enough time for you to put away some money for a down payment. When scouting for a house, consult a property expert who can give you the best value for your hard-earned savings.
Raising the down payment:
For people who don’t want to wait two years to take advantage of a mortgage loan, or those whose savings are not enough for a down payment, there are other options. You can still buy a home after bankruptcy by using other available sources:
1. Turn to your 410K. You can cash out a 401K or another investment you may have, and then repay yourself with a 2nd or 3rd mortgage (home equity loan/home equity line of credit) after the mortgage loan has closed.
2. Try ‘down payment assistance programs’ that aid the seller of the house in helping you with the down payment. This may sound illegal, but not under such programs as ‘Neighborhood Gold’ or the ‘Nehemiah’ project.
There are also down payment assistance programs that come in form of grants. The AmeriDream Downpayment Gift Program, for example, provides down payment assistance of up to ten percent of a home's price. To maximize the benefits offered by AmeriDream's Downpayment Gift Program, you must contact a lender and qualify for a loan that allows gift funds, and you must purchase a home from a builder or seller who has enrolled his or her home in the program. You should also check out ‘Newsong Down Payment Assistance Program,’ where you can use money from a ‘Newsong fund,’ and your seller contributes proceeds from the sale back into the fund for other homebuyers’ use.
3. Borrow from family. You can also opt to borrow the down payment required from your relatives. You can easily pay them back by taking out a 2nd or 3rd mortgage after you have financed the house. Remember: Some lenders usually have regulations about where the down payment is coming from. Be sure to disclose to the lender that your money is coming from relatives before you close the deal. | 
