How Soon Can I Qualify for a Mortgage After Bankruptcy?

Man holding figurine of house

Filing for bankruptcy is a difficult decision, but it can be the start of a new beginning. One question that often comes up after filing for bankruptcy is whether or not you can get a mortgage. How long ago your bankruptcy was discharged and what type of bankruptcy you filed determines the answer to this question. Our Knoxville bankruptcy attorneys will break down the ins and outs of getting a mortgage after filing for bankruptcy. We will also discuss some of the benefits of doing so!

Mortgage after Chapter 7 Bankruptcy

If you filed for Chapter 7 bankruptcy, it is typically harder to get a mortgage right after the discharge. This is because Chapter 7 bankruptcies involve the liquidation of assets in order to pay off debts. Lenders may view this as a red flag and may require a waiting period before approving a mortgage loan. However, if you have re-established credit and can show proof of income, it is still possible to secure a mortgage after a Chapter 7 bankruptcy. You must wait at least four years for a conventional loan after a Chapter 7 bankruptcy is discharged or dismissed. Loans backed by the government are a bit more lenient.

Mortgage after Chapter 13 Bankruptcy

If you filed for Chapter 13 bankruptcy, the process might be different. In a Chapter 13 bankruptcy, debtors are allowed to reorganize their finances and repay debts over a period of time, typically three to five years. During this time, it is possible to secure a mortgage loan if you can show proof of timely and consistent payments. Once the Chapter 13 bankruptcy is discharged, obtaining a mortgage may be easier as long as you have re-established credit and can demonstrate financial stability. On average, you may need to wait 2-4 years before qualifying for a conventional loan after a Chapter 13 bankruptcy discharge.

Benefits of Getting a Mortgage after Bankruptcy

There are several benefits to obtaining a mortgage loan after bankruptcy. One is the opportunity to rebuild credit and improve your financial standing. Making consistent, timely payments on a mortgage can demonstrate responsibility and help improve your credit score. Additionally, owning a home can provide stability and be an essential asset for long-term financial security.

It is crucial to remember that every situation and individual is unique.

Questions About Getting a Mortgage Before or After Bankruptcy?

Our team of seasoned bankruptcy attorneys can review your specific case and guide the best steps to take toward securing a mortgage after bankruptcy. We have a proven track record of helping clients overcome financial challenges and successfully rebuild their credit. Contact us today for a consultation.

Contact us at (865) 328-7993 or through our online contact form.

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