Home Buying in San Pablo>Question Details

Pbush, Home Buyer in San Pablo, CA

I have a credit score of 550 with a recent bankruptcy chapter 7. what are my chances of getting a loan.?

Asked by Pbush, San Pablo, CA Sun Aug 5, 2012

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I had a buyer that wanted to buy a home in Arizona, but he had a Chapter 7 bankruptcy 7 months ago. I introduced a loan program at http://www.cfsflex.com, they allow a mortgage after a foreclosure, short sale, or bankruptcy. There is only a six month waiting period. This is perfect for individuals looking to become homeowners again.
0 votes Thank Flag Link Sun Aug 4, 2013
Good morning Pbush,

We see many credit reports with low credit scores (anything less than 620), and often many scores in the 500's. This is BAD credit. If you are one of the folks affected by this terrible economy, you have a low credit score and you have a dream of buying a home, here's some simple advice for you.

It is unlikely you could be approved for mortgage financing with that credit score at this time.

Beware of any mortgage professionals promising you an approval with such a low score. Wait on buying a home. I recommend you take the time to resolve your credit issues.

First, settle any outstanding debt. If you owe money on collection accounts, charge-offs and/or judgments, make payment arrangements and get these accounts paid promptly.

Next, begin rebuilding your credit. If you have current accounts with good payment histories, or even some previous late-payment-blemishes, make sure you continue to pay those accounts on time. If you do not have any existing credit accounts then you'll need to establish several in order to create a viable credit history.

I have found that CONSUMER ACTION is an excellent resource for objective advice on all things credit related. You'll find free and sincere advice on everything from settling collection accounts to rebuilding credit to building credit from scratch on their website.

Beware of anyone offering to "repair" your credit! The Federal Trade Commission issued a stern warning last year that such offers are scams. Find more from the FTC HERE.

The best way to buy a home is to have a decent credit history combined with sufficient Income and Assets for a home purchase.

The best way to have a decent credit history is to settle negative outstanding obligations and pay all your bills on time for at least two years.

Trevor Curran
NMLS #40140

*If you thought my answer was helpful, please give me a “Thumbs Up” or “Best Answer.” Thanks!
0 votes Thank Flag Link Wed May 8, 2013
For sure with an FHA loan you need to wait 2 years from the discharge date.
But in that time, you can work on getting that credit score increased.
The biggest problme is that, most likely, the creditors that you included in your bankruptcy may be showing you balances either active or charged off. They need to say discharged in bankruptcy.
That will help.
Also, try to acquire credit with a secured credit card. Little by littel you can get that to a minimum of 620 for FHA
0 votes Thank Flag Link Fri Aug 10, 2012
I see different versions of this question almost every day. Your best bet is to speak with a lender directly where you can review your entire financial history...that will provide you with a much more accurate response than posting on a website...

Good luck.
0 votes Thank Flag Link Sun Aug 5, 2012
Slim to none... Try hard money loans.
0 votes Thank Flag Link Sun Aug 5, 2012
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