Mortgage Loans

There are six popular ways to mortgage a home after bankruptcy.

1. Wait six months
2. Sub-prime lenders
3. First-time homebuyer programs
4. Land contract conversion
5. 20% or more down payment
6. FHA Assumable No-Qualification

After the 24 months following your bankruptcy you can qualify for FHA or conventional financing. Your interest rate could be the same as someone with a great credit score. Your qualification is largely based on what you’ve done since you filed, as well as the lender’s guidelines. To improve you chances of being approved by a lender you should do the following:

If you accept a higher monthly payment by switching to a shorter repayment program you will be saving more money long term. The higher payment can be as little as $60 to $120 more costing you a mere $2 a day each month. Compare that to a whole year’s savings of interest.

Asking for a shorter repayment program will save money over a long period of time. The money owed on a mortgage loan will be repaid more quickly; therefore the lender is at a lower risk which means lower interest rates for you.

This means you aren’t only saving money because of shortening the length of the loan and paying less in interest, but the interest rate you will be offered will be lower. Even a point lower of interest each month could save you thousands of dollars in interest.

Mortgages are large, long term loans that are generally used in the purchase of a property. You can acquire a mortgage loan through a bank, credit union, private lender, or the property sellers. Mortgages in California are similar to a personal loan provided by banks except that its terms are much longer. Mortgages can have a minimum of fifteen years.

If you live in California you may have never experienced an earthquake or flood personally, or even in your area in the past, but when you buy a house your mortgage loan is recommended or required to be insured against the damages they can cause. Anyone considering buying a house should also look into these added insurance liabilities before mortgage comes into play.