Borrowers use home equity loans for many reasons, one of the most common reasons is to recover from bankruptcy or another credit-damaging event. In general, the interest rates on home equity loans are lower than rates secured through other types of loans.If you have a lot of equity in your home, filing for Chapter 13 bankruptcy can allow you to keep your home and reorganize your debts. But if you can’t exempt all of your equity, you may have to pay back a significant portion of your unsecured debts through your repayment plan.In this scenario, getting a mortgage after bankruptcy would cost the borrower an additional $53,605.81 over the life of the loan. Tips to get approved for a mortgage after bankruptcy. If you’re trying to get a mortgage after bankruptcy, the first thing you’ll need to do is get your credit score back on track.As with Chapter 13 bankruptcy, FHA regulations demand a full explanation to be submitted with the FHA home loan application. To get a new FHA insured mortgage loan after Chapter 7, the borrower must qualify financially, establish a history of good credit in the wake of the filing of the Chapter 7, and meet other FHA requirements.YES! you can get a home loan after bankruptcy. If you filed a Chapter 13 bankruptcy, you are possibly eligible for a home loan after 12 on time payments during your bankruptcy plan. s one day after discharge. But, to be granted a home loan in these cases you must meet certain criteria that pertains to your situation surrounding your bankruptcy.Home equity loans after a bankruptcy are great financing tools for borrowers to rebuild credit, get cash out and save money by consolidating debts. Consider taking out a new home equity loan even if you have a past BK, foreclosure or simply low credit scores.
In some cases, re-mortgaging the home can often realize a lower interest rate, which if spread over the same length of time, will result in lower monthly payments. When applying for a home equity loan bankruptcy option, it is important to advise the lender of the nature of the loan.How to get a home equity loan after bankruptcy. Keep in mind, a bankruptcy can remain your credit report for up to 10 years and seriously drag down your credit score, which might hinder your ability to qualify for a HEL. If you want to improve your odds of getting approved before that 10-year waiting period is up, start working as soon as possible on improving your score.