Getting A Mortgage While Having A Previous Bankruptcy or consumer proposal can be very difficult. Some banks won’t even consider giving you a mortgage until the judgement drops off your credit bureau 7 to 8 years after you have been discharged.
Luckily some lenders will provide you a mortgage under certain conditions.
In most cases conventional lenders like TD want you to have two trade lines established for two years each after your bankruptcy discharge. One trade line should be a loan and one needs to be a credit card or line of credit for $2000 or more that you have managed properly with no late payments.
Here are the main conditions banks like to see in order to provide you a mortgage 2 years out of bankruptcy:
- As noted above, the biggest condition is that you have re-established your credit with two new sources of credit. One of them must be revolving credit like a credit card or line of credit with a limit of $2000 or more.
- Preferred no late payments after discharge.
- Definitely no collections after discharge.
- Minimum 5% down payment but more is better.
- In order to get a mortgage with a lender you may not have had a product of theirs (Credit card, Loan or Line of credit) included in your bankruptcy.
- Must be your first bankruptcy.
Those are the main conditions the banks like to see in order to lend to you after you have been discharged from a bankruptcy or consumer proposal. It isn’t easy to get credit after being discharged but there are companies out there who will give some to you.
We are aware of some of these companies and would be happy to point you in the right direction and make sure your credit gets built the right way.
Thank you for taking the time to read my blog and feel free to contact me anytime.