Most likely you will be paying a higher interest rate after a bankruptcy, because of the increased risk perceived by the lender.

Very often, when a homeowner has been in a Chapter 13 bankruptcy for more than a year, especially if he has made all of his payments to the trustee on time, but even if not, he can save money every month by refinancing and paying off the bankruptcy.
This also helps by discharging the bankruptcy and putting this part of the persons life in the past.
Contact Darin Sewell at 414-773-9113 for more details.

To qualify for a conforming loan, a bankruptcy must have been discharged at least 4 years ago. Alt A and subprime loan programs may still be an option if it has been less than 4 years since the bankruptcy has been discharged.

Also you will find lenders that will loan even if you are in the middle of a chapter 13. FHA guidelines are 1 year from the file date. You have conventional lenders that will refinance your home if you have equity and are paying your chapter 13 payments on time. This is called a chapter 13 buyout. What's nice is you completely rid yourself of the debt in the chapter 13 using your equity to do so allowing you to be fully discharged from the BK. You will have to gain permission to do so from the court but it's very rare to be turned down.

When choosing among different bankruptcy mortgages, applicants should keep in mind that they are likely to refinance within a few years, after they rebuild the credit profiles through better credit management. Therefore, bankruptcy mortgage loan applicants should consider bankruptcy loan programs with lower starting interest rates, such as hybrid mortgages with a lower fixed rate for the initial two or three years.

After bankruptcy, it is also important to make sure that the customer seriously review their options to refinance and take cash out for debt consolidation with the goal of reducing the amount of the overall monthly bills they have into one low payment, which is much more readily manageable than a menagerie of high interest accounts.

Bankruptcy - Commonly abbreviated as the two letters BK, Bankruptcy is a legal protection afforded by court proceedings intended to provide relief to an individual or business unable to repay its debts.

Many lenders realize "bad things happen to good people". There are many programs available to those involved in a chapter 13 BK to help them refinance their current mortgage and pay off their bankruptcy. The lenders are going to look for a consistent payment history since the Bankruptcy was filed.

There are many loan programs for people who have filed BK. These programs are for refinancing and purchasing homes.

Although these programs will have higher interest rates, these loans are a great way to reestablish your credit profile and just two years of timely payments on a mortgage will do wonders for your credit score. Most borrowers refinance these loans within 4 years of obtaining them because they become eligible once again for certain conventional loan programs.

A legal procedure initiated voluntarily by the borrower or forced by creditors when the borrower does not make payments. Then the court divides the borrower's property among creditors to pay off obligations.

With bankruptcies at all time highs the courts have changed the bankruptcy laws making it much harder to file for Bankruptcy. Credit card debt is at an all time high and this is one reason for the numerous bankruptcies. Consult with a mortgage consultant before filing bankruptcy to see if there are any debt consolidation options available or any other options available to save you enough money so that you can avoid filing bankruptcy.

If you have filed bankruptcy in the past the odds are there is a mistake on your credit report somewhere. Maybe an account didn't report as being in the bankruptcy and still shows an outstanding balance which would adversely affect your credit. This is why it is crucial to always check your credit on a yearly if not quarterly basis.

Lenders will still lend you money if you have filed a BK. However they will require a certain amount of time to be placed between you and the discharge date. Often they need to see you have re-established yourself.

Countrywide offers great programs for individuals ONE DAY (1) after they have had their bankruptcy discharged!

For individuals, Bankruptcies come in two common varieties:
Chapter 13 Bankruptcy
Chapter 7 Bankruptcy

Chapter 13 Bankruptcy reorganizes debts under the supervision of a court ordered repayment plan. This is commonly referred to as a wage earner plan. Part of the individual's income is appropriated every month for distribution to their creditors.

Chapter 13 allows the individual to save and keep their property, and very often provides 3 to 5 years to repay debts.

Chapter 7 of the Bankruptcy Code provides for liquidation of an individuals non-exempt property, which may include the primary residence of the individual.

Recently bankruptcy laws have gotten more strict. If you have equity in your home you may want to consult with us to assist you with avoiding bankruptcy.

Most non-prime mortgage lenders have loan programs to help homeowners who have filed bankruptcy. Many even offer loans to those who are only one day out of bankruptcy.

If someone is already in a Chapter 13 bankruptcy and own their own home, they may elect to apply for a Chapter 13 buyout loan.

A Chapter 13 buyout works similar to a cash-out refinance, except that the cash taken out from the refinance is used to payoff you bankruptcy debts, thus discharging from your Chapter 13.

New Bankruptcy laws are more strict and the BK will be set to a 5 year pay back plan.
Before filing for BK consult us to see if there are alternatives.

If you have filed BK and want to obtain a mortgage, find a mortgage professional who specializes in helping the credit challenged. You will usually find this with a mortgage broker due to the broker's ability to place loans with multiple lenders. Having this ability allows the mortgage broker to research a lender with niche or special programs that do not conform to the standard guidelines.

Broker's get used to working with certain lenders and fully understand their guidelines which makes the mortgage process easier and go through with less challenges.

New Bankruptcy Laws - What They Mean to Consumers - With the new laws that went into effect in October 2005, many consumers are finding it more difficult to file Chapter 7 bankruptcy. Under the old laws, consumers could file Chapter 7 and wipe out most of their unsecured debt completely.

Under the new laws, they must first attend counseling, which helps determine if they can file Chapter 7 or Chapter 13. Most higher-income consumers will be forced to file Chapter 13, which is a debt repayment plan that doesnt wipe out the debt until the repayment plan is finished.

You can still pay off your Chapter 13 bankruptcy through a refinance. Many lenders have programs that allow you to pay off your Bankruptcy using the equity in your home.

There are some lenders who are willing to lend as soon as one day after bankruptcy has been discharged.

Speciality lenders will loan to borrowers in a Chapter 13 plan. The first test is the borrower must have paid on time to the trustee for at least six months. Some lenders want at least 12 or 18 months with no late payments. The next step is to get approval to pay off the chapter 13 plan from the trustee handling your case. The test for approval is the refinance must show a benefit over the current payment plan. If approved, the lender will need to see the trustee approval. The rest is a combination of credit score, ltv, and income with the specialty bankruptcy friendly lenders willing to lend with scores in the 500's with homes that have a high amount of equity.

Alternatives to Filing Bankruptcy - 1. Try to sell off your asset or pull your equity out of your home.
2. Consumer Credit Counseling Services (CCCS).
3. If CCCS wont take you, you may want to consider bankruptcy. Doing a Chapter 13 takes longer, but your credit is in a little better standing than if you do a Chapter 7. In the Ch 13 they give you up to 5 years to pay off your debts. The disadvantage is that youre in BK for up to 5 years plus your credit report shows your BK for 7 more years after you have finished paying off your debts.
4. If you fall behind the CH 13, then consider filing CH 7 bankruptcy. The disadvantage for this is that the bankruptcy record will stay on your credit report for 10 years and this will cause you prevented from obtaining future financing.

How can I buy-out my bankruptcy? - If you have some equity in your home and you are in a chapter 13 bankruptcy but the bankruptcy payments are not helping, you might want to consider buying out your bankruptcy.

You need to check with your Trustee to make sure there are not any certain rules or fees that will be associated with paying off your bankruptcy.

Lenders who are familiar bankruptcy buy-out will require a list of debts to be cleared with the pay-off. If the equity remaining in your home will cover the remaining pay-off of the bankruptcy agreement, the early pay-off will help speed up re-establishing credit. Although these mortgages come with a higher interest rate, the benefits of the early bankruptcy release along with immediate credit clearance usually out-way the temporary increase in interest rate.

Most Chapter 13 bankruptcy buyout programs will require that you have a 12-month history of on-time payments on your bankruptcy as well as any other credit accounts that remained open or have been recently opened. The buyout loan works just like any other cash-out refinance, but in this case the equity in your home is converted into money to pay off the remaining bankruptcy debt. You will need authorization from the bankruptcy court or your bankruptcy trustee before proceeding with the buyout loan, but your mortgage professional can help you obtain this authorization as part of the loan process.

The bankruptcy buyout loan is part of a financial plan to help you re-build your good credit. Once you have closed on your bankruptcy buyout loan, your Chapter 13 bankrputcy will be discharged. The interest rate on your mortgage will be higher for the short-term, but you can begin applying for credit again and by consistenly making on-time payments to your creditors, establish a good credit profile. After having been discharged from bankruptcy for two years, you may again be eligible for conforming interest rates and can consider refinancing to lower your interest rate and your payments.

Can I Get a Mortgage With a Bankruptcy? - This can be summed up in one word - Yes. Agressive programs from agressive lenders makes money available for people who have filed a BK.

Sometimes minor credit repair is needed for a mortgage after bankruptcy. Often credit report balances will not reflect as zero and instead show the full amount owed prior to bankrutpcy. If you have filed a bankruptcy in the past its important to go over your credit report with a professional to make sure its completely accurate.

The type of bankruptcy that was filed will be the first determining aspect in deciding what type of mortgage financing you qualify for.

Getting a home loan after bankruptcy is not too difficult with sub-prime lenders, although the borrower should expect to pay a higher interest rate. Because of the high bankruptcy mortgage interest rates, when choosing different types of bankruptcy home loans, potential borrowers should expect to refinance the mortgages to lower interest rates after they have a chance to rebuild their credit in a couple of years.

There are many programs that allow up to 100% financing 1 day out of a bankruptcy. Of course your credit score needs to be able to support this also. Basically if you have managed to straighten out your credit since the bankruptcy it is possible to have a decent credit score by the time your bankruptcy is paid off.

Your chances for home financing will increase if you carried some accounts through the bankruptcy. Some lenders will also use your cancelled rent checks for a tradeline.

You will often want to plan a two step strategy when refinancing out of bankruptcy. Refinance once now to get your affairs in order, pay off debts, lower your overall monthly expenses, and help you rebuild your credit, and then a second refinance in two to three years to take advantage of your new credit score and any additional equity in your home you may have built or gained throug appreciation.

It is also possible to refinance while you are currently in a chapter 13 bankruptcy. You will have to get permission from the bankruptcy court and show that you have made payments into the plan on time for at least 12 months. Keep in mind that the maximum loan to value on these types of loans are typically from 70%-80% depending on the lender.

To offset some of the higher rates that you may get after filing a bk you may choose to go with a short term arm such as a 2/28 or 3/27 where the payment is fixed for 2-3 years and at that point you can come back and refinance into a program that better fits your needs.

On a chapter 7 bankruptcy lenders usually look at the discharge date and not the file date. On a chapter 13, a lender may look at the file date unless the chapter 13 has been dismissed. Your mortgage broker will be able to get the best lender for your particular situation.

A bankrupcy does not exclude you from getting a mortgage. It simply means you are a higher risk to the lender. Your rate may be higher, the fees a bit higher but the mortgage can still be obtained.

There are two schools of thought when it come to evaluating mortgage loan risk for a borrower who has had a bankruptcy. The traditional thought is that because the borrower showed a record of complete mismanagement of their obligations and had to be releived of them through the bankruptcy, they are a very high risk. A newer school of thought says that very few consumers will file two BKs within a ten year period so a borrower with a recent BK is a very low risk to go bankrupt again any time soon.

You can still get a mortgage after bankruptcy. However, try not to forget what got you in the situation to begin with. You need a great financial plan to keep you out of trouble.

After a bankruptcy you can still be considered and qualify for a mortgage. You must consult with a mortgage broker to find the best deal available for you depending on your exact situation (what type of bankruptcy was filed, how long has it been discharged, is the BK still active, what are your current credit scores, is there any re-established credit since the bankruptcy, etc...) The chance of you obtaining financing after a bankruptcy at your local bank are slim to none. A mortgage broker will have the option to search hundreds and some times thousands of lenders to find the lender who it going to be best for your situation after the bankruptcy, whereas your local bank has 1 set of guidelines that you will most likely not fit into after a bankruptcy.

Your chances will increase if you did not close out all your accounts in the bankruptcy. There are lenders that will ignore the BK if your score is 600 or higher and will even go to 100% financing. The main factor in this is established tradelines and if you closed all your accounts out in the BK you may not be able to qualify for 100% financing. You may still however be eligible for a lower amount such as 80%-90%

If you filed on mostly medical items and kept your car payments and/or credit card payments up to date your credit score may not be that bad. You may easily qualify for a home loan. The best course of action would be to pull your credit and see where you are at before you start looking at homes.

Many borrowers witha discharged Chapter 7 Bankruptcy can qualify for an FHA Loan 2 years after their discharge. Borrowers with proper documentation that an event took place outside their realm of control that caused the bankruptcy such as an auto accident, etc. with re-established credit may qualify with just 1 year out of the bankruptcy. Borrowers currently in a Chapter 13 bankruptcy may qualify for a refinance or purchase if they can document timely payments to their trustee, get permission from their trustee, and have made at least 1 year of timely housing payments.

Bankruptcy Means Test - One of the most controversial and complicated additions to the new bankruptcy law is the requirement that every debtor complete a bankruptcy means test before filing bankruptcy. The bankruptcy means test is a complicated mathematical calculation to determine what type of bankruptcy a debtor must file.

You must enter income and expense information onto the appropriate state bankruptcy means test form and then make calculations using the entered information. Debtors must provide the calculation and results of the bankruptcy means test to the bankruptcy court as a part of the debtor’s schedule of current income and expenditures. The two main variables for the bankruptcy means test calculations are: Median State Income Figures as published by the U.S. Census Bureau and the IRS National Standards for Allowable Living Expenses.

You will fail the means test and be denied bankruptcy if you make too much money for your particular state. As an alternative to bankruptcy, you should talk to a mortgage professional about a cash-out refinance loan that could provide you some relief.

If you cannot pass the means test, you cannot file Chapter 7 bankruptcy, which erases all of your debts. You can still file Chapter 13 bankruptcy, which sets a plan to repay sometimes all, but usually only part of your debt. Repayment is made over 3 to 5 years.

One purpose of the means test is to show the court you deserve to file bankruptcy because you really cannot pay the debt. When considering a bankruptcy its important to work with both an attorney and a mortgage professional. The attorney can guide you and direct you with important decisions such as the means test. The mortgage professional can work with you as you go through BK and help you re-establish your debt. This can make homeownership or refinancing simpler then if you walk thru it alone.