Foreclosure FAQ: Can I Buy A House After Foreclosure?

A lot of homeowners who have been through foreclosure wonder when they will be able to buy a home again. Let me say it's not an easy task, but not impossible.

The first thing to consider is that a foreclosure stays on your credit report for 7-10 years. However, lenders usually look at the last three years of credit when considering a mortgage approval. It is important to start planning your credit rebuild immediately to pad the foundation of your financial picture. Start with a secured credit card, on which you only spend and pay off 30% of the allowed credit limit each month. Next, get an apartment and stay there for two years. Pay your rent on time EVERY month and use the favorable review from the landlord as a good credit reference.

The second thing to think about is your down payment. It will be critical to put down as much money possible if you want to go towards the traditional mortgage route. Since the foreclosure is going to be a consideration factor, start saving for a 20% down payment.

Next, be CONSERVATIVE when it comes to choosing your next property! The Taj Mahal will not be in your budget... talk with a Realtor to realistically plan how much house you can afford, and then consider looking at houses BELOW that threshold.

The most important thing is to plan your finances and be disciplined with your spending and saving goals. You can rebuild your life... it just takes practice and focus.

Good luck!