The circumstances were not good for you a few months or years ago. You lost your home to a foreclosure. The lender forced the foreclosure because you didn't make payments on your loan or the taxing authority auctioned your home off. You feel overwhelmed and frustrated by the entire process. Perhaps you've moved in with someone else or you've been renting since then. Nevertheless, you still want to buy a home. When can you do so? Will a lender even let you consider buying a home again?
Don't give up just yet. The fact that you had a foreclosure is important, but it doesn't mean you will never own a home again. It does mean you'll have to work harder at obtaining a loan and getting a low interest rate. Nevertheless, for many people who have gone through this process, it led to better results. They were able to get out of a home they could not afford to pay for, which ultimately helped to reduce some financial stress.
Know the Facts
There are a few key things to keep in mind when looking to buy a home after foreclosure. First, realize that FHA loans are available, but only after a three year waiting period to obtain the loan. In some cases, though, especially with conventional loans for buyers, there are loans available prior to this timeframe. You will want to talk to a mortgage specialist to determine when you can buy. Also note that any waiting period after foreclosure begins once the foreclosure is complete.
While you wait for any required timeframe to pass, it is time to work on improving your credit. That means paying off debt and improving your FICO score. You'll also want to increase your down payment as much as possible. Lenders see you as a risk since you've already gone through foreclosure once. With a better credit score and a larger down payment, you'll likely attract more interest from mortgage lenders.
It may take time but you can be a homeowner again. It is quite important for you to select the right lender and to work with that lender to get any qualifications you can. Realize, too, that waiting longer can help you to improve your credit score so you don't overpay with very high interest or become limited with a very low loan amount to borrow. You'll get there, one step at a time.
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