Getting Home Loans After a Bankruptcy

The lending market has tightened restrictions, making it more difficult to get home loans with bad credit. Financing a new home loan after bankruptcy is not as simple as it used to be. The good news is, there are a few steps you can take to improve your credit score after filing bankruptcy. If you establish good credit following a bankruptcy, creditors will be more likely to lend money for home loans in the future. Here are a few steps you can take to make it easier to get a home loan after filing bankruptcy:

1. After your bankruptcy has been discharged, make sure you make all of your payments on time. This includes any house payments, mortgages, car loan payments and credit cards. Make sure that any debt that reports on your credit report is paid on time so you don’t have any new delinquent debts reporting. By showing a pattern of paying your debts on time after bankruptcy, it is more likely that you will also pay a new mortgage payment on time.

2. Open a line of credit, or a credit card, even if it’s pre-paid. Use it to pay for gas or groceries, and pay it off each month. This also helps to establish a pattern of good credit management which can bring up a bad credit score.

3. Purchase a copy of your credit report online and make sure everything is reporting correctly. Sometimes debts that were included in your bankruptcy will still be listed as an open delinquent account which hurts your credit score. By disputing any items that are not reporting correctly, the credit reporting agencies will be able to convert the debts to report correctly as discharged in bankruptcy so they will no longer be bringing down your score. Get an Equifax 3-in-1 Credit Report Now >

4. Consult with a loan officer that specializes in sub-prime loans. An experienced loan officer can review your credit, job history, bankruptcy information and financial status and give recommendations as to additional steps you can take to obtain a home loan after your bankruptcy. Be patient as it may take several months to repair bad credit and boost your score high enough to  qualify for a home loan after bankruptcy.


Fashionably Green Houses are Wearing Blue Jeans…On the Inside

There are many options to consider when choosing insulation for your home. Traditional fiberglass batts, spray-in cellulose, spray foam and blue jean insulation are among the choices. So what are the advantages, pro’s and con’s of each type? Here’s an insulation comparison.

Blue Jean Insulation contains the scraps and waste material that is left over as a result of the denim manufacturing process.

  • Advantages: Using recycled/recyclable materials reduces loads on landfills; Good thermal performance; Good sound control; Most brands do not include harmful chemicals; does not contain skin-irritating fiberglass; works for do-it-youself insulation projects.
  • Downsides: It comes in batts which don’t fill gaps as tightly as foam; Blue jean insulation tends to be more expensive than other types of insulation.

Spray Foam Insulation is sprayed in place and expands to fill in the spaces between the studs and does a great job filling tiny cracks, creating a tightly sealed home when properly applied. There are different types of spray foam; closed or open cell, polyurethane or soy based. Some spray foam insulation products do not contain harmul chemicals.

  • Advantages: Spray foam provides the tightest seal, excellent thermal performance, and can easily be applied to attic ceilings, creating an insulated space for a/c ducting and pipes.
  • Downsides: Spray foam usually costs more than traditional batts or cellulose, and is not an easy project for a do-it-yourselfer.

Cellulose Insulation is also sprayed in place. Containing primarily recycled newspaper, cellulose insulation proves to be a viable alternative for those seeking a green alternative to traditional batts.

  • Advantages: Recycled content is a green choice; Provides good thermal performance; Many brands do not contain formaldehyde; Cost effective.
  • Downsides: Rumored to sag over time, reducing thermal performance; not an easy project for a do-it-yourself homeowner.

Traditional Fiberglass Batts are the most widely used type of insulation, having been around since the 1930’s. More recently, many people are seeking alternatives to fiberglass batts as concerns over health hazards related to breathing in fiberglass particles, skin irritation, and the controversial potential dangers of formaldehyde (used to preserve many brands insulation) have grown.

  • Advantages: Most cost effective; easier for do-it-yourself projects than spray-in insulation types.
  • Downsides: Does not seal the building as tightly as spray foam; possible health concerns; not a “green” building material.

Our top pick for total building insulation, assuming budget is not a concern, is spray foam. Our favorite for sound dampening (between floors or in plumbing walls) is blue jean insulation.

Bankruptcy vs. Foreclosure

Some parts of the United States are seeing a rebound from the housing crisis. However, other areas are only just seeing the beginning which is leaving cash-swapped consumers with some serious decisions. One of the decisions that these consumers face is whether to allow their house to be foreclosed on or instead filing for bankruptcy protection.

When making this decision, the consumer must first decide if they would like to keep the house. This is a particularly emotional issue when a family is involved. When children are in the picture, families are often willing to make sacrifices to prevent uprooting them. If this is your situation, or you have other reasons for wanting to keep the house, then foreclosure is obviously not an option.
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