Mortgage Post-Foreclosure: 3 Steps to New Ownership

By October 29, 2013Home Buying, Homeowner, Mortgage

It’s Saturday morning, and you’re watching your child playing on the playground next to your apartment building. Sure, it’s not the backyard you used to have behind the home you used to own, but there’s plenty now to feel upbeat about — because there’s money in the bank for the first time in a long while. It’s only a matter of time until you’re watching your child play in a yard from your own porch again.

One thing worries you though. Is your foreclosure going to keep that yard and porch out of your grasp?

Yes! You can get a mortgage after a foreclosure

It is possible to get a mortgage after a foreclosure, but it will take hard work on your part to repair your credit and establish yourself as a sterling example of financial responsibility. Depending on your circumstances, there may also be a mandated waiting period of one to seven years. However, there are several concrete steps to get you on your way and possibly lessen your wait.

First of all, get a handle on your financial reputation. Get your hands on every official record you can find, including your credit report, and make sure all the information about you—and the details of your foreclosure—is 100% accurate. Be vigilant. Sometimes debts that you thought had fallen off your credit report can be sold to new collection agencies and reopened. Contact anyone presenting inaccurate credit information, and have it corrected.

Yes, there are concrete methods to responsible credit repair

Here is where some hard, day-to-day work comes in. Your credit needs to be squeaky clean from here on out, but if that makes you want to hide and avoid using credit at all, think again. A mortgage broker will want to see that you’ve learned financial responsibility. So, it’s time to start building new credit. For regular use, apply for a secure credit card—and pay it on time! And while this may seem counter-intuitive, consider applying for a high-interest credit card—store cards are a good choice—and carry a balance no more than 30% of its limit. Of course, you’ll need to pay it on time and preferably in full every month.

Next is a big purchase. No, not the house yet. A car, a large appliance, something you could reasonably take out a loan for. Make sure it’s a loan you can manage, and here’s where you will really impress a mortgage broker: Be better than the terms of the loan. Overpayment, extra payments, early payments — be so good that Ebenezer Scrooge couldn’t find fault with you.

Yes, someone can help you

Of course, the best way to get started on repairing your credit and getting a new mortgage after a foreclosure is to speak to a credit repair professional like Ovation. Each of our knowledgeable representatives work with you personally to build a credit repair and credit re-establishment plan that is tailored just for you. Call us today for a free consultation.

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