Buy Another House With Your Good Credit

Selling your house will certainly not signify the end of your home ownership days. Keep your credit as clean as possible to adhere to the current raised loan criteria when ready to buy again.

Minnesota Real Estate - South St. Paul House Buyers: The idea of buying another house once you have had to sell because of financial difficulty is often on the minds of those who are in fear of losing their home. Whether you will lose the house to repossession, short sale, or had to sell because of some adverse circumstance that prompts you to sell, you may be wondering if you will ever have a chance to own your own home again.

That question’s answer will depend entirely on the credit that you have been able to preserve. A foreclosure will stop you from doing all sorts of things for which you need good credit including jobs, rental houses and apartments, insurance, and loans for cars or any other large ticket item you may need to buy. If you allow your house to be repossessed, it will stay on your credit report for at least 7 years. It is similar to a bankruptcy when it comes to applying for things that depend on your credit.

If you sell the house to a real estate investor at a short sale, the results will be a bit better. That means you will sell the house to a buyer that gives the lender just short of what is owed on the mortgage. If the bank accepts it your mortgage obligation will be fulfilled and the difference is usually forgiven. You may have to claim the difference on your income taxes, but other than that you won’t have repossession and your mortgage will be paid off. It will show up on your credit report but won’t be as brutal to your credit score.

The inability for so many to repay their loans has had a very negative effect on the lenders,

Maintaining the best credit you can at this point in the current economy is wise because it has become difficult to obtain a loan from a bank for large items like houses and cars. The fall of the real estate market has had this effect on those who had relaxed their loan standards to a point where it was almost guaranteed that you could have a loan if you simply wanted one regardless of your ability to pay or an awful credit score.

The inability for so many to repay their loans has had a very negative effect on the lenders, for obvious reasons, and those they are accountable to have instituted stricter lending criteria. Be prepared for the stringent loan qualifications and you will be able to buy another house before you know it.

Tagged with: credit • house selling

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