While filing for bankruptcy will surely have an adverse affect on your credit rating, there are still ways to obtain a home equity loan after filing bankruptcy. While many prime lenders will not approve your loan application, there are many sub prime lenders who will.
Sub prime lenders are those particular lenders who are wiling to work with individuals who have a very low credit score, past bankruptcies, accounts currently in collections, or otherwise poor or non-existent credit histories. These types of lenders will take into consideration such factors as your length of employment, your yearly salary, other financial obligations, as well as if you have any cash assets that can be used as sort of a down payment. Lenders are more apt to approve your application if you are able and willing to start off with a substantial investment.
If course, since these lenders are taking a huge risk, they will no doubt charge you extremely high interest rates. Some sub prime lenders charge from 1% to 12% higher interest rates than do prime lenders. Over the life of a loan, this can equate to quite a substantial amount of money!
If you do decide to apply for a home equity loan after filing bankruptcy, if at all possible try to wait at least a year after the filing so that you will have time to improve your credit score a bit and build up some credit worthy accounts. This will work in your favor, and may help you in obtaining a lower interest rate.
While there are sub prime lenders who only deal with high-risk loans, some more traditional lending institutions, such as banks and credit unions, may offer sub prime loans. Shopping around and comparing interest rates is a wise idea, especially if there has been a bankruptcy in your past. Even though a bankruptcy can make it difficult to secure a home equity loan, it does not make it impossible.
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While filing for bankruptcy will surely have an adverse affect on your credit rating, there are still ways to obtain a home equity loan after filing bankruptcy. While many prime lenders will not approve your loan application, there are many sub prime lenders who will. Sub prime lenders are those particular lenders who are wiling to work with individuals who have a very low credit score, past bankruptcies, accounts currently in collections, or otherwise poor or non-existent credit histories. These types of lenders will take into consideration such factors as your length of employment, your yearly salary, other financial obligations, as well as if you have any cash assets that can be used as sort of a down payment. Lenders are more apt to approve your application if you are able and willing to start off with a substantial investment. If course, since these lenders are taking a huge risk, they will no doubt charge you extremely high interest rates. Some sub prime lenders charge from 1% to 12% higher interest rates than do prime lenders. Over the life of a loan, this can equate to quite a substantial amount of money! If you do decide to apply for a home equity loan after filing bankruptcy, if at all possible try to wait at least a year after the filing so that you will have time to improve your credit score a bit and build up some credit worthy accounts. This will work in your favor, and may help you in obtaining a lower interest rate. While there are sub prime lenders who only deal with high-risk loans, some more traditional lending institutions, such as banks and credit unions, may offer sub prime loans. Shopping around and comparing interest rates is a wise idea, especially if there has been a bankruptcy in your past. Even though a bankruptcy can make it difficult to secure a home equity loan, it does not make it impossible.