Bankruptcy Law, Credit, Foreclosures, Timothy Kingcade Posts

Don’t think you can buy a home after bankruptcy? Actually, you can.

There are a number of myths associated with bankruptcy; the inability to purchase a home is one of them. Bankruptcy is certainly not the end of homeownership.  In fact, all major mortgage programs available today- conventional, USDA, VA and FHA home loans-have established guidelines that allow post-bankruptcy buyers to qualify for a mortgage.

Each loan type has its own waiting period requirement after bankruptcy. Waiting periods for the four major types of loans are as follows:

  • FHA loans: 2 years
  • VA home loans: 2 years
  • Conventional mortgages: 4 years
  • USDA home loans: 3 years

While these are the “standard” guidelines, you may qualify for a conventional or FHA loan even sooner.  Both of these loans have exceptions for “extenuating circumstances” or one-time events that caused income loss and were outside of the homeowner’s control.

In this case, an applicant can be approved for a conventional loan just two years after bankruptcy, and an FHA applicant can receive approval after one year in the “Back to Work Program.”

Below are some quick and easy ways to re-establish your credit after bankruptcy.

  • Re-establishing your credit involves opening credit accounts and paying them on-time for at least 12 months. These credit accounts must be kept open and active.
  • Begin with a credit card. Use it for gas and groceries and pay it down every month.  Keep a small balance on it so the credit bureaus can see that it is active, but keep the balance below 30% of your available balance.
  • The credit bureaus value a diverse credit profile, more than just credit card accounts. Personal loans, student loans and car loans are other types of credit.  Credit bureaus want to see that you can manage your credit responsibly.
  • Lenders may look for non-traditional credit. For example, 12 months of cell phone bill, gym membership, car insurance, cable bill, etc.

With proper planning, you can re-establish your credit to the level at which you can qualify for a home loan.

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Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at