Refinancing After Bankruptcy

Have you filed for bankruptcy? Are you now wondering how long it will be until you are again eligible for credit? You may be pleased to learn that refinancing your mortgage is not only easy and financially beneficial, but can happen fairly quickly as well.

If you haven't already filed for bankruptcy, make sure you choose your lawyer wisely, as a knowledgeable lawyer will both simplify the process and formulate a plan for bankruptcy discharge that will enable you to refinance sooner. There aren't any laws that prevent you from refinancing immediately after bankruptcy, so take advantage of it.

The importance of a talented lawyer cannot be stressed enough if you are planning to file for bankruptcy and/or refinancing your mortgage. A trustee has many tools to use to protect the creditor(s). Attempting to hide financial resources could backfire and end up hurting you more in the long run. Doing everything on the level will keep you safe legally and financially. A good bankruptcy lawyer can help you do this.

Only one year after you file for bankruptcy, you will be able to find refinancing rates that are affordable and desirable in the long run. For the first two years after bankruptcy, you will be termed a "sub-prime borrower," and many companies will be reluctant to lend to you. However, if you have equity in your home, you will be able to find some companies that will lend to you at a minimum of 4 percent over prime.

One popular option for those who have filed bankruptcy and are looking to refinance is an FHA mortgage. FHA mortgages are part of a federal loan program that does not require discharge, and permits you to refinance as soon as one year after filing. Eligibility for an FHA mortgage is dependent upon your mortgage payments being made on time.

The sooner you refinance after bankruptcy, the sooner you can begin to rebuild your credit score. The sooner you rebuild your credit score, the sooner you will be able to obtain better interest rates.

No two financial situations are alike. It is important that you speak with a professional debt counselor or bankruptcy lawyer before making any decision regarding bankruptcy or refinancing.

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• Is Bankruptcy the Only Option?

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