Bankruptcy myth: I won’t be able to buy a home or car
An extremely common misconception about bankruptcy is that those who file will forfeit all their property and important assets.
An extremely common misconception about bankruptcy is that those who file will forfeit all their property and important assets. In many states, though, people who seek this protection actually don't lose anything. Statutes have been put in place to ensure that far from becoming destitute after filing, many families are able to prosper. They keep their cars, homes and all valuable items.
But even those Minnesotans who are aware of the exemptions in bankruptcy cases sometimes avoid filing because they believe they won't qualify for a new home or car loan after their case is settled. This is another damaging myth.
In some cases, mortgage lenders require a two-year waiting period, but that isn't the case with all companies. By keeping your spending responsible in the months following your settlement, you can actually secure a home loan earlier than that.
Experts advise that, once your proceedings have finished, you obtain a low-limit credit card and make small purchases with it, being sure to pay off the bill each month. One man, interviewed by CreditCards.com, said that following his bankruptcy filing, he bought both a town home and an investment property. He told the website that now his credit score is 805, higher than it was before he filed for protection from creditors.
Once you begin looking for a home, enlist the help of an expert realtor who is knowledgeable of lenders in your area. These home-buying professionals can often negotiate you a better deal on your house, and similarly can help you pre-qualify for a home loan.
If you're considering filing for bankruptcy in the North Star State, be sure you seek help from an experienced Minneapolis bankruptcy law firm. Local professionals like Michael Sheridan can guide you through the steps and find the right path for you.