How do points go up after Foreclosure?

Hi CC!

Welcome to the forums!

Generally it takes more or less around 5-7 years to improve the credit history. However, if you had filed Chapter 13 during foreclosure, then as soon as you start paying your debts according to the new plan, your credit score will start improving.

Make sure that you pay your bills on time and keep open a least two major credit cards so that you can build a new solid credit history. Lenders will want to see a dependable track record after your foreclosure.

Feel free to ask if you have further queries.

Sussane

you will have to pay your bills on time and have to support two credit cards. apart from this, you should also note that if you have filed a bankruptcy it will remain in your credit reports for around 7 years. if you have filed a chapter 13 bankruptcy, then pay your debts according to the new plan on time. this will help in improving your credit score.

cc...please don't think it will take 7 years for your scores to improve. that's simply not so.

what you will want to do is the obvious - pay every creditor on a timely basis; avoid getting new credit, except where absolutely necessary; maintain at least 3 lines of trade - that doesn't mean you have to transact business, but just to keep the lines open.

forget the chapter 13 references above - that didn't happen, and it wouldn't make sense to even discuss this now.

don't be irritated or annoyed because your scores don't go up in 15 minutes (some do!). this is normal, and the foreclosure is a heavy duty credit hit, so improvement is going to take a while.

also, avoid having creditors run your credit. if you are curious as to what is being reported, go to www.annualcreditreport.com and you can view your report free once a year. if you only view 1 of the 3 agencies this time, and then scatter your views of the other 2 over the next 12 months, you'll have access to each one again after the year (do i make sense on this? i hope so).

annualcreditreport.com is the officially authorized site by the three credit repositories - trans union, experian and equifax. honestly, you probably don't need to see your scores at this time, so don't bother to buy them. next year? maybe - but why waste money if you know they won't be up to speed.

Hi George,

Is it possible after foreclosure (assuming all t's are crossed and i's are dotted) to bring one's score back to the 700's or better?

Thanks!

absolutely, marie. just don't expect to see it happen in the first year or so after the foreclosure. if you are handling all of your other credit obligations the way that you're expected to do, and if you keep from shopping for future credit for a while, and keep those balances on accounts you have as low as possible, it's always a possibility to bounce back. i guess what i've just cited are "i" and "t" in each case.

Does it hurt you credit any less if you qaulify for a short sale? Also, if I have to foreclose (or can short sale) on one property but am able to keep another and maintain the mortgage on that, will that help the blow my credit from the other one? IF so or if not, will it at least help speed up the recovery? OR will it make absolutely no difference that I'm showing current on a different mortgage? (sorry, so many questions in one).

Foreclosure is not the end of the world. If you do the correct things you can have you score back up in the 700's within 2-3 years after a BK.

Hi Ren!

Welcome to forums!

A short sale lowers your credit score by 75-100 points whereas a foreclosure will reduce your credit score by 250 points. Though you foreclose on one property, you'll be able to maintain your other properties and pay mortgage on that. You will have to take steps to improve your credit score after the foreclosure is complete. You can check out the given page to know some steps to improve your score:
http://www.mortgagefit.com/credit-rating/credit-repair.html

Feel free to ask if you've further queries.

Sussane

We rec'd our BK judgement last Jan. & It included the house. Our mortgage is an interest only and the Mort. co. won't work w/us to modify, so we'll probably have to move out eventually. we are still paying the monthly fee. My question is, if we stop paying the fee, to begin saving up to rent elsewhere, does that get reported on my credit since we've already had the BK? or not. Right now my interest only loan just keeps getting higher than the original loan. I can walk away from it, but am also trying to build my credit back up.

this is only an opinion not based on fact, cindy, but i wouldn't think you could do a whole lot more harm to your credit right now anyway. stopping payments on the mortgage now is essentially only a continuation of your recent bankruptcy. i'm sure your scores took a serious tumble in the bankruptcy, so this new move wouldn't do that much damage, maybe.

what i think it would also do, however, is make it that much more difficult to retrench and get your scores back on the increase any time soon.

I am about 4 weeks from foreclosure(10K behind). I have been trying to get a modification but for some reason they can't seem to get into my file. I am looking at relocating back home. I've been in my house 10 years and I know I can bounce back. I'm just wondering should I take this step and leave; there is no way I can come up with 3.5-10K down payment. Just lost atthis point.

If your are already in the process of foreclosure, you are better off just walkign away

Rather than letting your lender foreclose the property, you can apply for a deed in lieu of foreclosure. Though it will lower your credit score by 250 points, you won't be responsible for paying off the deficient balance to the lender. However, after a deed in lieu, you won't be able to purchase a property immediately. You'll have to wait for at least 3-4 years to get a new mortgage.

What happens after foreclosure? My property has already been sold,do I have to file or can I wait out my 7yrs.? I still own on the first and second loan,everything else has been paid off.