Tips for Buying a Home after Foreclosure

When the real estate market crashed, thousands of Americans lost their homes to foreclosure. Now that the market is finally starting to recover, what are the odds that these families can obtain the mortgage necessary for buying a new home?

According to Trusst builders in Wilmington NC, buying a home after a foreclosure isn't impossible, but there will be challenges ahead. Here are some tips to help you improve your odds of securing a new mortgage.

Wait the Required Period

Depending on your situation, you could have to wait anywhere from one year to seven years before you will be eligible for a new mortgage after having a property foreclosed upon. If you have successfully completed a Chapter 13 Bankruptcy and you want a new loan insured by the Federal Housing Administration or guaranteed by the U.S. Department of Veteran Affairs, then you only have to wait a year. But, the wait turns to seven years if you are looking to get a conventional mortgage that can be sold to Freddie Mac or Fannie Mae.

If you had a foreclosure with a bankruptcy, then the wait time can vary. If you sold your home at a short sale before it was actually foreclosed upon, then you may not even have to endure a waiting period.

Clean Up Your Credit

Clean credit is essential for securing a mortgage in today's world. If you had a foreclosure, filed for bankruptcy, or sold your home at a short sale, then your credit needs to be spotless after the fact. Just one missed or late payment can disqualify you for your loan.

Before applying for a new loan, buyers need to review their credit reports and correct any errors or misinformation. They can also attach clarifications to certain items so they can describe the circumstances that led to the report. This will help lenders gain a more accurate picture of the events that led to the foreclosure.

Consult a Mortgage Professional

If you are considering applying for a mortgage in the near future, get started early and consult with a lending professional. They will be able to help guide you through what you need to do in order to improve your odds of qualifying. They will also let you know when you should apply for your new mortgage as getting pre-approved is the key to knowing how much you can afford to spend on your new home in the new economy.

Trusst Builders in Wilmington NC Can Build You the Home You Need

If you have suffered a foreclosure, and you recently got pre-approved for a mortgage, don't think that you can't afford a new home. Trusst Builder Group has a variety of floorplans to choose from that complement a range of budgets. Schedule a consultation with one of our builders and we can find you a home to fit your family's needs, wants, and budget. Just give us a call today at 910-371-0304 to see what our builders in Wilmington NC can offer to your family.