January 6, 2014

Different Home loan options

When you file Chapter 7, you are no longer legally obligated to repay the loan. “Legally obligated” are the key words here because Chapter 7 does not get rid of the lien on the property. Your lender still has a right to the property if the debt is not paid. So basically, you don’t have to pay your mortgage. But if you don’t you will lose your property because your lender will likely enforce the lien they have. If you are able to keep your home as part of Chapter 7, it’s probably a good idea to do everything in your power to keep paying your mortgage.

Most reputable lenders, including Quicken Loans, will not consider you for financing until two years after the Chapter 7 bankruptcy has been discharged. If you find a lender who will consider you prior to two years, make sure you are fully aware of all the terms and conditions included in your mortgage. Really scrutinize the details and look at all the costs to ensure you’re not being scammed.

Ok, what about Chapter 13? What happens with my existing mortgage?

With a chapter 13 bankruptcy, you will not lose your property. You will include details on how you plan on paying your mortgage in your repayment plan. In most cases, an automatic stay is issued once Chapter 13 is filed. An automatic stay means that creditors must stop collection efforts. It was designed to temporarily halt foreclosure and stop repossession of homes regardless of the stage of the foreclosure proceedings.

How long do I have to wait after Chapter 13 to get a new mortgage?

Most reputable lenders, including Quicken Loans, will not consider you for financing until at least one year after the Chapter 13 bankruptcy has been discharged. Some exceptions are made for US veterans. If you find a lender who will consider you prior to one year, make sure you are fully aware of all the terms and conditions included in your mortgage.

Filing for bankruptcy is a big decision that has a lot of implications for your current and future financing. Make sure you discuss your options with a lawyer or your financial advisor before you stop making payments or file for bankruptcy.

Source: www.quickenloans.com

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FAQ

How to get the best mortgage rates - Quora

I agree with Michael Cheng. If you have a great credit score, stable, verifiable income, verifiable cash on hand or assets, you are a dream client. By comparison shopping, you will be able to obtain a Loan Estimate from at least three different types of lenders: Talk with the mortgage department of where you currently bank. You already have a banking relationship with them. This is a good place to start. Next, apply with a local, licensed non-bank mortgage lender. Somebody located in the town in which you live. Last, apply with a local mortgage broker.