There are many people who have successfully managed to purchase a new home even after they have filed personal bankruptsy. While it may seem difficult at first, you should never let bankruptcy cancel your aspirations to own a house. There are a few important things you will want to keep in mind about mortgage after bankruptcy and buying a house after bankruptcy.

Showing available cash is the best way to convince a lender of any type that you are committed to seeing the terms of any agreement for post-bankruptcy loans through. However long it might take you to save up a greater-than-average down payment on a house will be worth it, because your chances will be all the better. On the other hand, applying for a mortgage too soon after bankruptcy when you have not had the chance to save up sufficient capital may result in a reported rejection, which will only weaken your credit profile and make it take longer to succeed. When you are approaching a lender to discuss buying a house after bankruptcy, try to have at least 20% ready for a down payment. While this is higher than the average down payments available for customers without economic setbacks, it will do a lot to show any lender that you are serious about doing what it takes to get back on track. For the bank you then represent less of a risk regardless of your credit history, because at a certain level the loan is secured by the value of the house and the house is worth more than the mortgage that remains after the increased down payment. In other words, lending you the money gives the bank mortgage rights in the house, and the amount of the house that's left to pay off after the down payment is still less than the total value of the house. This means a safe investment for the bank and better chances you'll get what you need.

If you're not happy with what you see available right away, remember that it's usually possible to get a more competitive rate on a mortgage when you wait at least 18 to 24 months after your bankruptcy filing. Not only will this increase your chances of eventually getting a loan that will be better for you in the long run, but it will allow you the time you need to really get an understanding of what you can expect to afford in the future while maintaining your new financial health.

There are several websites, such as and that can help you get a better idea of what offers are available to people seeking mortgages after declaring personal bankruptcy.


(in Oakland, CA)



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