Archive for the ‘Bankruptcy’ Category

Credit After Bankruptcy

Tuesday, November 25th, 2008

Do you consider filing for bankruptcy? Yet are you also thinking about your future credit options? When you are in debt, bankruptcy should be your last option. However, don’t think that you won’t have the chance to start again once on the file and you get everything squared away. To help you with this, find a professional for all your options. But if the bankruptcy is all you can do, remember that your financial world is not completely over in the future. There is still credit after bankruptcy.

Companies are willing to extend professional help after bankruptcy of credit. They know that you need one, and they also know there is a considerable period between submission and time when you may be able to file anew. This means that from the beginning they know they have a better chance to get their money from you because you will not be able to turn around and then file again if you default. They know that you are a risk, however, and this means that any credit after bankruptcy, you will get a higher interest rate and tougher penalties on late payments.

You’ll discover that some of the companies which just lost out to you will try to offer you credit after bankruptcy. This occurs when your debt is cleared and your name isn’t in their data system anymore. Some big companies do not keep track of old debts that were written off, and luckily you could be anyone of them. This is also true with credit after bankruptcy.

If you’re seeking for after- bankruptcy credit, remember to use your head. Filing for bankruptcy happens because your credit is bad, and you had no reasonable means to pay all your debts. If you filed for bankruptcy, you will not be in a better position of obtaining credit immediately after the bankruptcy and it will be to your disadvantage than you think. You see, it doesn’t make sense to file, and then put you back to credit . If you need help with the budget, spending patterns, and how to save your money for the future, consult a consumer credit counselor.

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Bankruptcy: Know the Right Questions to Ask

Wednesday, October 29th, 2008

Are you in deep trouble with your finances? Have tried just about everything to get out of trouble? Some have tried credit counseling or get debt consolidation loans. But those things don’t always work for everyone. When families or individuals are at the end of the rope with their debt, bankruptcy seems to be the only option that they have. This looks like an easy way out. However, others say that bankrupcy isn’t advisable if there are other options that can save them financially. Before you declare bankruptcy, start by asking the right bankruptcy questions.

Question # 1. Should I do it on my own or should I get a lawyer?
You are better off with a lawyer, but that isn’t always feasible. Some lawyers who handle bankruptcy know that money is involved to get you out of your problem, so they require payment plans. Research on bankruptcy lawyers who can answer some of these questions. You may find some reliable lawyers through the Internet if you’re patient to search.

Question # 2. What will this do to my credit? To reiterate, though some may think they’re going to be better off, it may not be easy that easy after all. You will think about getting credit after bankruptcy. You may be given credit but it is not always what you want. Usually it t will come with a very high interest rate. Credit consolidation loans and other options should be considered first because they will not be as harmful to your credit situation as bankruptcy will be when it is all said and done.

Question # 3.How long will the process take? The process depends on the situation. There may be instances that you will be required to go to court for your proceedings. But if you seek the help of your lawyer, you may not be asked to appear in court.

Question # 4. Will there be some debts excluded? Some debts like student loans are exempted from bankruptcy. In short, you will still owe that money once you have gone through the process, and it will still be refl;ected on your credit report.

Bankruptcy seems to give you a new start, but it definitely comes with a price.

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Get A Home Loan After Bankruptcy

Tuesday, October 28th, 2008

Have you experienced bankruptcy?  Do you wonder if you can still get a home loan?  Or maybe you also wonder if buying home after bankruptcy is a good idea after all.

Bankruptcy may affect your mortgage loan approval. It might be difficult for some mortgage companies to have your papers approved. But yes, it’s possible to get a mortgage after bankruptcy. In fact, there are a number of bad credit loans coming all the time.

These companies are what we call as subprime lenders. They are actually there to help poor credit to purchase home after bankruptcy. This occurs mostly because bankruptcies are increasing and there is a growing number of people with bad credit who are seeking financing for the home.

Here’s an overview to consider when you think of buying a  home after bankruptcy:

Increase your credit rating. Paying on a regular basis will help rebuild your credit rating. Once your pre-payment penalty is paid up, you should be able to refinance your loan credit for a lower interest rates.

When you have completed paying your mortgage 2-3 years after bankruptcy, you will have a much easier time qualifying for a lower interest rate on the mortgage.

By then you’ll be able to own an asset. If you’re just renting a house then you are absolutely throwing your monthly payments away. Why not buy a house,? Over time, your house’s  value will increase and you work your way out of debt because now you have an asset.

After you purchased your home, in as short as 6 months or sooner,  you can take a loan on your home and consolidate any other debt you may have had. Taxes and student loans will not be discharged in bankruptcy. You may also want to use the extra money to invest in a business or home improvement if necessary.

It is very tempting to buy a new house, a new car, or make renovations. You might  feel that now you can afford a larger house. But it’s not so easy ; there are a few factors to consider before you commit to a new house payment.

1. The pre-payment penalty. This penalty is usually about 6 months of house payments and payable usually in 2-3 years. When you sign the mortgage documents you absolutely make these payments. If you have no money for the pre-payment penalty of savings, you will have to choose the locked in payments or worse, lose the house.

2. Two years paying period. Remember that after 2-3 years of the date of bankruptcy clearance, mortgages will be much easier to obtain. With a small deposit, you can even be able to obtain a mortgage without pre-payment penalty.

So if your mortgage plan is 6 months to 2 years, it would be smarert to wait and have more options to mortgage.

3. Borrowing too. If you decide to buy a house, know if you can afford it. Do not place  yourself on another credit and on the tip of your income. Of course, if your income drops suddenly, you’d want that you can continue to pay your home. Therefore, be conservative with buying the house you need.

Many of us believe that bankruptcy is the end of our credit life. Despair not because many people who have been out of business were able to recover quickly and rebuild their credit. Most of the, too were able to buy a new home .

Your bankruptcy report will be posted on your credit report for 10 years. Surely each mortgage lender will  see this fact when assessing your mortgage application. Although it may be difficult to find a bank to give you a mortgage, it is not impossible. The banks want to make money and there may be one that is ready to take the risk.

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