Renting and Buying a Home after Chapter 13: Try These 4 Tips

Think your plans for renting or buying a home after Chapter 13 bankruptcy are doomed? It’s only natural to wonder how this form of bankruptcy will affect your living situation, but then again, you’ve got to live somewhere, right?

The truth is, renting and purchasing a home after filing for Chapter 13 are possible.

Is it going to be difficult? You bet. But if you take the right steps, you can find the right place for your situation.

Ready to get down to business? Let’s look at these four tips for renting and buying a home after Chapter 13.

Explain Your Situation

If you’re trying to rent a home during or after your Chapter 13 bankruptcy, the best way to begin is to write a letter explaining your situation to any prospective landlords. Many landlords understand that just because you’ve had to file bankruptcy doesn’t mean you’re a bad person. Lay out in the best possible way how the bankruptcy happened and the steps that you’ve taken to pay your debts.

Ask for Letters of Recommendation

Another way to secure an apartment or home rental is to ask the people in your life for letters of recommendation. Choose people who are upstanding members of your community, such as a current landlord, a boss, a religious leader, and others who command respect. These references can speak to your reliability and good character.

Document Your Current Living Situation

You can also show prospective landlords that you will be a good renter by giving them documentary evidence that you can keep their property well maintained and in good condition. It also doesn’t hurt to throw in pictures of your family, especially if you have children. Demonstrating that you have people who rely on you and that you are willing to do what it takes to provide for them can go a long way.

Apply for a Mortgage with the FHA

If you don’t want to become a renter, buying a home after Chapter 13 is also possible, but it is much more difficult. Expect to wait at least 12 months from the date that you file. Your best chance at securing funding for a new home is to apply for a mortgage through the Federal Housing Authority. However, you should be prepared to show that you’ve completed the following steps before you are approved:

  • The pay-out period has elapsed for at least a year.
  • You’ve made all required payments during that time, and your payment performance has been satisfactory.
  • You’ve asked for and received permission from the bankruptcy court to enter into a mortgage transaction.

Get advice on renting and buying a home after Chapter 13 bankruptcy

It will take some time and effort, but renting and buying a home after Chapter 13 bankruptcy are possible. AM Law is here to help. Contact our bankruptcy and real estate attorneys today if you want to go over your case with us.