We are seriously committed to straightening out our finances and working hard to build a home in 5-7 years. In 4 years we will own property and will have saved $30K for a down payment. At that time it will be about 4 years after a bankruptcy (filed in 2001) and we WILL have perfect credit thereafter. As for income, I will be in real estate but can't estimate what I'll bring in, and my husband will be with the same company while earning a percentage from his family's business. Our combined income will be $100K annual or more. This is all speculation given that there won't be a hard recession. So what, in four years, would a lender think of our loan application to construct a $200K home? It will show a bankruptcy that occurred 4 years ago, $30K down payment, steady income and perfect re-established credit after the "b" word. (FYI - The property is valued at $80K and homes are listed for $300K-$500K in the neighborhood.) My husband used to be in car sales where a bankruptcy was easier to get financed with than a credit repair, so this is what I'm hoping. What should we include or change about this plan? And what should we alter if there is a recession? With the recent tragedy it has us thinking life is way too short....we plan to work hard, enjoy life, and get where we want to be before it's too late. Thanks for ANY help! And God Bless America!
Hard to say. With perfect post bk credit, you can qualify for FHA loans at conventional rate 2 years after your discharge. But, I believe the current limit of an FHA loan is $131k. That number will rise over time. To be sure of getting conventional financing, you need to have a downpayment in the 20% range. I'd suggest saving evry bit of money you can and a year or so before you are ready to build, start trying to arrrange the financing. At least, get ideas from lenders about their requirements for conventional financing.Post bk financing is like many things in life. If you can put enough of your money in the deal and have good income, the lender is apt to feel more comfortable and will price the mortgage accordingly. Good Luck!
Thanks for your help!
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