Four Things to Know About Mortgages after Bankruptcy
Sometimes bad things happen to good people and bankruptcy can be one of those things. When a borrower who has experienced a previous bankruptcy seeks out a traditional lender, their options can be severely limited due to the damage done to their credit scores. The good news for borrowers like these is that a prior bankruptcy is not a deal breaker for an alternative lender like Kokanee Mortgage.
Four key points to keep in mind while preparing a mortgage application after bankruptcy:
- The borrowers must first be discharged from bankruptcy. The application can be filed the next day but not while they’re still in bankruptcy.
- Multiple bankruptcies will be a challenge. Borrowers must be prepared to thoroughly explain to lenders how each bankruptcy occurred and how it won’t happen again.
- Borrowers must be well prepared to explain the story of how they got into the problem that lead to the bankruptcy and offer reasonable assurance that it was a one-time only event
- The ability to demonstrate a solid income will be very important. Alternative lenders will place more emphasis on income as they will want it to be illustrated clearly that the borrower is able to fulfill their financial obligations.
A mortgage from an alternative lender like Kokanee Mortgage is often the first step for borrowers trying to rebuild their lives after bankruptcy. Arranging the right mortgage for a borrower after bankruptcy will a lot easier if the key points are all adequately addressed.
The experienced underwriters at Kokanee Mortgage are always available to help you work through challenging situations like those of a prior bankruptcy.