Getting a Home Loan After Bankruptcy

Getting a Home Loan After Bankruptcy

Richard Fonfrias, J.D.
Chicago’s Financial Rescue & Bankruptcy Lawyer
Fonfrias Law Group, LLC


Bankruptcies can stay on your credit report for up to ten years. That doesn’t mean they will stay that long, but they might.

Even so, you don’t have to wait ten years to buy a new home. In fact, filing for bankruptcy helps you start rebuilding your credit immediately.

Research shows that debtors can qualify for a home loan on the same terms as non-filers in as little as 18 to 24 months.

What’s more, the Federal Housing Administration’s requirements for home loan qualification are more flexible than other lenders. You can re-establish your credit with FHA as long as…

  • 24 months have passed since your bankruptcy discharge;
  • You have paid or made arrangements to pay any outstanding tax liens;
  • 3 years have gone by since any foreclosures or deeds-in-lieu of foreclosure; and
  • You have paid all judgments.

This sounds good, but when you apply for a home loan after bankruptcy, any home loan you get will no doubt be at a higher interest rate than for a person who has not gone through a bankruptcy. Even so, don’t let that change your mind. You can do two things: First, make your down payment as large as possible. This will keep your loan small. And second, make sure that your loan does not have a prepayment penalty. In this way, as your credit score improves, you can refinance your home at a lower interest rate.

Offering a wide range of financial legal services, including foreclosure avoidance, bankruptcy filing, credit repair, loan modification, tax reduction and tax lien services, Rich Fonfrias is a Chicago bankruptcy attorney who helps people in financial trouble. Rich has years of experience in all aspects of Illinois business law and Illinois bankruptcy law. Serving the greater Chicago, Rich has built a solid reputation as a trustworthy and knowledgeable advocate for individuals and business in trouble. Take the first step on the road to financial health and prosperity. Call Rich at 312-969-0730 or email