A foreclosure isn’t that bad as you’ve been expecting. Of course you are going to be stressed out from spending tons of time dealing with it, as well as hitting your finances. Even though it might change your personal views on the future, it wouldn’t take that long to begin chancing your life. Moreover you have a great opportunity to start out looking for a new home and move in a very short time period.
After you overcome the foreclosure and everything, related to it, it’s time to purchase a new house and start over. Here are some important things to be done to make your life easier.
1. Taking a break.
Remember that it’s going to be a very bad idea if you will be purchasing home right after you did the foreclosure. Even though you might have good financial situation, it’s worth waiting at least 24 months before taking another mortgage. The thing is that your credit score is much lower after the process of foreclosure: it can get down on more than 200 points, which can work only if you apply to this fast borrowing service, but not for a home loan. Waiting 2 years is going to work out well, as your score will get stable again, so that you will have greater options on the mortgage plan with nice rates.
Credit reports often contain errors and wrong personal information, which can affect your credit or so. To prevent this happening, check out a credit report, if it has some errors. Ask your creditors to correct anything that is mistaken to prevent possible misconceptions.
3. What type of loan do you have?
Each type of the mortgages offers different polices and guidelines. To be aware of every detail of it, look through the documentation real quick to make sure you know specific rules and terms. For example, some mortgages won’t allow you to take a loan right after you dealt with foreclosure. Some of the other ones, though, can’t be taken unless it’s over 16 months since you’ve been finished the process of a foreclosure.
4. Requirement about down payments.
Some lenders make their customers pay at least 20 percent of the whole amount of money to be lent or even 30. Federal funded companied, though, would be able to allow you to pay through your insurance.
Moreover, there might be some new requirements you should fit in to be approved. Besides you need to have the same employment for more than 2-3 years, you must always get the same amount of paycheck or maybe higher. Because you’ve been stable for all those years, it means lender can trust your ability to pay down the mortgage.
Besides of the option of purchasing a house, here are other things to be done after a foreclosure process. One of them is rent-to-own homes, which is a special program, which is a good alternative as well. Once you pay rent for it, a small part of that money goes to your down payments for the house. After some time, when there a certain amount being saved, the person is able to buy a home, using them. It seems like not so great idea, however a bunch of lenders agree on those terms, because they would know their customers have a goal of staying in the house till the very end.