The North Carolina Bankruptcy Information Blog

The nation’s residential real estate market continues to tumble, further complicating life for millions of Americans looking to either buy or sell a home in the near future.

Not only that, but home sales are so tightly wound into our economic system that every ebb and flow tends to create ripples on Wall Street. Financial analysts around the country are doing all they can to instill a sense of calm in the American people about our financial system. Every time they do, more facts about a faltering real estate market come to light, scaring those who currently own and increasing the hesitation in those thinking about buying.…

Even with tremendously low interest rates and diminished, buyer-friendly market conditions, owning a home can still be quite expensive.

If you have had your heart set on home ownership as a personal, post-bankruptcy goal, it’s important that you also consider the ancillary costs of home ownership before you make a move based solely on an affordable monthly mortgage payment.

The best advice for would-be home owners is to limit the role emotions have in your buying decisions. Real estate agents see it happen all the time—and so do creditors. Suddenly, your reasonable monthly payment balloons by a few hundred bucks because you believed that one house on the list was the one you had to have, even if it was $50,000 over your budget.…

Regardless of your current financial situation—from good credit to no credit—there’s no denying that we’re living in a tough housing market. So if you’re considering bankruptcy, you might think that if it’s a challenge to become a homeowner for those in the best financial times, it might be next to impossible to acquire your dream home if you’re currently recovering from a Chapter 7 or 13 bankruptcy filing.

The hard and fast truth is that getting your financial house in order following your bankruptcy, especially in order to qualify for a mortgage loan to get the home you want, is more possible than you think.…

During the mid-2000s, housing prices reached stratospheric levels with mortgage lenders more than willing to be liberal with their loans, selling the idea of the “home as American Dream” to anyone who would listen—whether they were qualified or not.  But, if the recent housing crisis has taught us anything, it’s that home ownership isn’t always what it’s cracked up to be.

So, after the recent mortgage meltdown, many are wondering: “where do we go from here?”

That’s the very question asked in a recent report by NPR. In it, correspondents found that after two decades of expansions in home ownership—fostered by government mortgage guarantees by the now much-maligned likes of Fannie Mae and Freddie Mac—many policymakers are looking at housing finance reform as a top priority to the nation’s prospects for economic recovery.…

Just a few years ago, home ownership was something available to just about anyone—an economic reality that to an extent, contributed to where we are today. Nevertheless, the mortgage boom helped a lot of people realize that benefits of home ownership. It’s simply too bad that it came with so many hidden financial pitfalls, many of which have subjected sub-prime borrowers (and also those with standard mortgages) to serious, long-term hardships.

Today, almost the exact opposite has become reality. Mortgages are exceptionally more difficult to obtain and when they can be approved, the houses themselves don’t qualify because of drastically diminishing real estate values.…

Debtors attempting to avoid bankruptcy by waiting for housing prices (and equity) to increase may be waiting a long time. In fact, according to The New York Times, wealth-building via housing booms may have also gone the way of guaranteed pensions, free healthcare, and secure employment.

Per the NYT, “many real estate experts now believe that home ownership will never again yield rewards like those enjoyed in the second half of the 20th century, when houses not only provided shelter but also a plump nest egg. The wealth generated by housing in those decades, particularly on the coasts, did more than assure the owners a comfortable retirement.…

Everyone—from the halls of Congress to the many channels of media—is paying a ton of attention to those Americans who have lost their homes in the seemingly endless mortgage meltdown. Virtually ignored have been the millions who continue to pay their mortgage every month, even when they really can’t afford to. As a result, most homeowners are losing big on what used to be their biggest investment.

Which begs the question: Is the best solution to stop paying your mortgage?

For homeowners around the country who haven’t skipped their mortgage payments—but are seriously struggling—there are several reasons why homeownership is going less than swimmingly:

You’re Trying to Staying Afloat While You’re Underwater
Many of you are struggling to pay off a mortgage balance that is significantly higher than the value of your home.…

Foreclosures have become a plague across the country, sickening the economies of small towns, the general contractor industry and even the commercial real estate industry. No facet of the real estate world has gone unaffected.

Whether your home was foreclosed upon or your mortgage lender granted you a short sale (negotiated permission to sell your home for less than what is owed), it was probably considered a tremendous relief to drop the proverbial financial anchor tied around your neck.

However, thousands of Americans once in the same boat are now finding that the tide is again rising around them, as banks and lenders are coming back months later for the remainder of what is owed on the home.…

So the impact of your bankruptcy is settling in. You have mixed emotions but underneath, feel confident that it was the right thing to do. The phone has stopped ringing, the mailbox delivers good news (for the most part) and best of all, you can sleep again.

Now that it’s time to get back on track, saving money should be a top priority. And one way to do that is by examining what it takes for you to keep a roof over your head every month, even if you managed to avoid foreclosure. Today, thanks to the real estate crisis which saw developers nationwide building new home homes and apartment communities on every plot of improvable land, it is a buyer’s market.…

Filing bankruptcy, among other things, is about getting a new start. Few things can match the sense of relief that follows even the first phone call to our office, let alone the day you know for sure that your bills are gone forever.

For some, starting over may mean leaving behind everything that contributed to your old spending habits, the material goods, the car, even the house, that led you deep into the financial abyss. If that sounds like you, maybe it’s worthwhile to consider a relocation, not just a downsize.

Know that moving is expensive. So yes, you’ll have to save money.…

One of the greatest benefits of filing for bankruptcy protection is that it allows struggling homeowners a second chance to catch up on missed mortgage payments. For many people, the fear of losing a beloved family home is one of the most stressful parts of their struggle with debt. But is your house really worth saving?

If you find yourself living in an “upside down house,”  it may be worthwhile to consider simply letting the house go. “Upside down” refers to a property where you owe more money than the house is worth. Back when the housing  market was still booming, this situation was almost unthinkable, but now that the bubble has burst, short selling―selling a home for less than what is owed―is all too common.…

The economy is so grim right now it’s hard to see the silver lining, but the good news about markets is that they rarely stand still forever. Even now, economists are slowly and cautiously becoming more optimistic about the situation, and consumers are gradually gaining back confidence. The housing market, for example, posted a quarterly rise in prices for the first time in three years, which may indicate a stirring of recovery. Still, there are a lot of homes out there not worth half what they were recently, and new construction has ground to a halt for the time being. Is there a silver lining in this one for you?…

The economic recovery packages rolled-out by the federal government are providing a lot of people in the midst of rebuilding their financial livelihood a chance to get back on track even faster. For those who are underway with getting back on their feet after a successful bankruptcy, today’s housing market, in conjunction with the First Time Buyer Tax Credit, is offering home ownership opportunities not seen in a long time.

Here’s a breakdown of how the homebuyer tax credit shakes out:

You are eligible for the tax credit if it has been three years since you owned a home. This is ideal for those who may have lost a home through foreclosure or decided to sell to reduce their monthly mortgage commitments before bankruptcy.…

The month of July 2009 saw yet another increase in the number of consumer bankruptcies filed in the U.S., as low employment and high consumer debt continues to be a toxic combination throughout most of the country with only little signs that an antidote can be found. The number of filings, 126,434, was a 34.3 percent increase from the same month in 2009 and 8.7 percent increase from June, 2009.

Most experts agree that the rapidly decreasing number of jobs is in direct correlation with the consistent increases in bankruptcies every month. Also contributing to the increase is the so-far ineffective Home Affordable Modification Program.…

It’s a couple of years after your debts were discharged in a Chapter 7 bankruptcy, you’re on track with your payments and expenses, and you’ve been working steadily to rebuild your credit. Now you’re ready to buy a new home: you’ve done all the homework, you’ve looked for good lenders and you’ve found your dream house. All you need now is to borrow what the house is worth, right? Well, not quite. If you have had some negative history on your credit report since your bankruptcy, you may need to come up with as much as 30% of the value as a down payment in order convince a lender to extend a loan to you.…

Buying a home after bankruptcy is a smart move. And yes, it is possible! If you don’t own a home already, buying a house is an excellent step toward rebuilding your financial life. A home can be a great investment because it is one of the few major assets you will own that will hopefully appreciate over time. Home ownership also demonstrates stability, which can reflect positively on your credit profile.

The good news is, as soon as a year after your debts are discharged in a Chapter 7 bankruptcy, you may be eligible for a good car loan, and just two years after completing a bankruptcy, you may become eligible for a home mortgage with a good interest rate.…

Future home ownership is a major concern of so many people who have made the decision to file bankruptcy. A previous post on this blog discussed the ins and outs of your ability to buy a house after emerging from bankruptcy. The good news is that it is completely possible and that you can indeed be a very viable mortgage candidate.

However, there are some drawbacks to home ownership in general, many of which are related to costs. For starters, buying a home is not going to be the same rapid-return investment it was five years ago. As you know, the recent real estate boom sent home prices flying because financing was so readily available.…

Bankruptcy gives you a fresh start; a relief from the stress and uncertainty about your future. Your hope is that things will soon be back to normal. But that hope is often based on the answers to so many questions. For many, one of those questions may be about your ability to buy a home. You may have heard the myth that a bankruptcy is a black mark on your credit, and that you will never be able to buy a home. Don’t believe it for a second! You can buy a home after bankruptcy. With some time and planning, it will be much easier than you think.…