I do not know if it was better for me to buy a house?

Deal Score0

Four years ago, I declared bankruptcy (Chapter 7) – where the good and the collection agencies finally caught up with me years after I was young and stupid. I am now 30, has completed a bachelor’s degree, working on my master, and have a good steady job. My credit score is 718 now (and slightly increasing each month), I have three large and two credit cards from department stores to total approximately $ 400 each. My car is paid for. My only major expense is the time to repay their student loans $ 30,000 (consolidated). What is my life and credit back on track, if it is the best time for me to think about buying a house? My grades are better and higher than the national average …. But how bankruptcy hurt me if it is not possible to obtain a mortgage or pay the high interest rate? Should I wait until my score is higher at some point? Should I wait until the bankruptcy is my report (6 years older)? Where can I refinance after that? Thank you!

  1. Reply
    Tom S
    April 29, 2011 at 9:42 pm

    Do it now. It’s a buyers market, especially here in CA. Your score is good enough and you’re far enough away from your bankruptcy.

    If you’re considering buying in CA, send me an e-mail. Tom4Loans@sbcglobal.net

    Good luck!! And, nice job on the recovery.

  2. Reply
    April 29, 2011 at 10:03 pm

    NOW, do a pre screen on lendingtree.com. It doesn’t affect your rating and my score was 600 with no down and I bought a house last fall. good luck

  3. Reply
    Shreya S
    April 29, 2011 at 10:12 pm

    well i think u should purchase your own house when u think that u r ready wid lots of money to purchase it. & do u belive in havans …………… if really than after purchasing it but before fiffting to that house do a haven . for your newly purchased house

  4. Reply
    April 29, 2011 at 10:22 pm

    Technically, when you file, and you are still under the automatic stay from creditors, you must seek approval from the bankruptcy judge who heard your case at the creditors meeting, etc. If any creditor finds out you have obtain a mortgage while still under the automatic stay, they can file to have your bankruptcy dismissed, (not to be confused with discharge), and reinstated for payment on your old debts. To answer the latter part of your question, the bankruptcy automatic stay lifts after 7 yrs, but remains on your report for the full ten years.

  5. Reply
    Louis M
    April 29, 2011 at 11:13 pm


  6. Reply
    Joe T
    April 29, 2011 at 11:54 pm

    While others cite low rates as being a reason to buy a house using a mortgage, I disagree.

    Firstly, you are still in school. Don’t even consider buying a house (and going into major debt) until you have a higher income.

    Secondly, you have $ 30,000 in student loans. I assume they are being deferred for now, but as soon as you graduate with your master’s, they will need to be paid. Have you considered how much they will cost monthly? Even consider not applying for a mortgage until you have paid off your student loans.

    Assuming your single and your income goes up when you graduate, you should be able to knock out the $ 30k pretty quickly. Then save up at least 20% for a house down-payment. This will also help keep your interest rate down.

    Also, without the student loan payment, you will be able to afford a 15yr fixed rate mortgage, which will do a lot more to reduce the amount of interest you pay than a point or two (compared to a 30 year).

    Reducing risk is an important consideration that a lot of people ignore. More debt equals more risk (and less control)!

  7. Reply
    April 30, 2011 at 12:05 am


    first and foremost, you should disregard all of the other responses other then the one saying for you to buy now!

    Every lender or bank out there has VERY different guidelines in which they lend money. I work with many investors that will work with you a day out of bankruptcy. Now being that you have been out of bankruptcy for 4 years, and have a 718 credit score, you are in a perfect situation..

    Credit scores range from 450-850. Most people who have been in a bankruptcy have credit scores under 600. You have obviously have turned things around since you filed, and i think you will be very surprised to see what you qualify for.

    I have investors that would treat you no differently then someone with a 718 credit score that has never filed bankruptcy in their lives. The reason is that most lenders do want to see you out of bankruptcy for at least 4-5 years. My investors guidelines state that as long as you have been out of bankruptcy for 12 months with no missed payments (major payments, mtg, car, etc.) then the bankruptcy is IRRELEVANT…

    So being that you will easily qualify for a good program, the other thing to look at is rapidly rising interest rates..The sooner you can get into a locked fixed interest rate, the less you will pay in interest..

    As for your student loans, almost 80% of homeowners ijn america still have student loan debt. It is very normal being that student loan debt has increased more in the last few years then almost anything.. What you need to look at is being able to afford a payment. You need to have someone analyze your credit and finances, and put together a couple options for you . From there you will know how much of a mortgage you can afford, and have a better idea of what kind of house you can buy.

    My name is Jason Fry, and I am a loan officer with Providential Bancorp, a nationwide mortgage lender. I’d be happy to assist you in a purchasing a home, or at least be able to let you know exactly what YOU QUALIFY FOR. You can then make a more informed, and educated decision whether it would be the right move for you.

    Feel free to give me a call at 312-264-6448, or
    you can email me at Jasonf@providential.com.

    Thank You,

    Jason Fry
    Providential Bancorp

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