Mortgage Lenders for people with Foreclosure
February 25, 2011
Author: Allison K.Watkins
It is hard for someone to get a mortgage following a foreclosure; however, it is possible. Having a foreclosure really looks bad on a credit report but with the right formula, getting a mortgage with a foreclosure can be done. There are still mortgage lenders for people with foreclosures.
Length of Foreclosure on Credit Report
A foreclosure on a credit report can stay on for 7 years or more. Most mortgage lenders typically will focus only on the last 36 months of a credit report when it is being evaluated for a mortgage application.
Cost of a Mortgage with a Foreclosure
After waiting, a couple of years getting another mortgage is achievable after rebuilding a credit score. This does require a substantial down payment where as someone with better credit could get away with a lower one and with a lot less hassle. There has been a drastic reduction in sub-prime lenders within the last few years. These lenders specialized in mortgages for those with bad credit.
Foreclosure Waiting Game
Those with foreclosures usually can find a mortgage lender with within 2 years but it is very expensive interest rate wise. It may be more advantageous to wait a little longer when the credit score has had time to correct itself before applying for a mortgage.
Rebuilding a Credit Score after Foreclosure
Sticking to a budget and paying bills on time for a while will help a borrower is repaired to get a mortgage in a proper amount of time. Having a substantial down payment will make a new mortgage less expensive. So make sure that saving is part of any new budget plan. The efforts to rebuild credit will create a track record of improvement and this will mean savings when it comes to the next mortgage.
Time Is On Your Side
After the waiting period, persistent shopping will pay off. Different lenders have different standards and many will be frightened off by a foreclosure on a credit report. If approvals are not forth coming do not lose hope just stick to the plan. Time is your friend when you are looking for a mortgage lender for people with a foreclosure on their record.
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