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How To Manage Your Mortgage After Bankruptcy

Now that the worst is over and you are somehow coping after bankruptcy, there will be a lot of things that you’ll need to think about, such as your mortgage. Since declaring bankruptcy stops foreclosure proceedings you gain some time in working out the situation. But it is temporary, it still needs to be resolved.

Talk to Your Bank about a Mortgage Reaffirmation Agreement

Mortgage BankruptcyReaffirming the loan means agreeing or signing a document as your promise to repay the remaining debt, either by installment or through one full payment, depending on what terms you can both come up with. However, you will need to first learn if your state allows such agreement, because some states will legally allow a mortgage company to foreclose the property and then ask you to pay off the remaining balance afterwards.

Ask if you are Eligible for an After Bankruptcy Loan Modification

In some cases, mortgage companies will allow you to still live in the house while you pay off the remaining debt. This will depend on how you work it out with the company, so make sure you reach out to them and let them know that you are still interested in keeping the house. In order to make this possible, you will need to show them that you will try your best to always pay on time.

Seek Professional Help Not Only in Bankruptcy but Also in Mortgage Negotiation

For cases like personal bankruptcy, you will certainly need a lawyer that specializes in this field. Even after the case is over, do not forget to talk to your lawyer regarding your mortgage, and ask him what kind of legal advice he might have for you. If he’s good, he should be able to help you negotiate with the mortgage company.

After Bankruptcy Consider Applying for a New Mortgage

If you’ve weighed the possibilities and realize that the repayment terms are not going to work for you, you should consider applying for a new mortgage. You may find it difficult at first, since you will need to re-establish good credit in order to qualify.  But there are several mortgage companies that are willing to grant a home loan for those who went through bankruptcy, so it is not impossible to do.

Start Rebuilding Your Credit

Once things are almost back on track, as soon as you are able to pay off all your remaining debts, you are finally on a clean slate. This time, make sure you won’t make the same mistakes again, such as not paying your bills on time. You need to re-establish your financial credibility, so you have to avoid falling into those bad habits again. Be more responsible and always think twice before making a purchase.

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