Detroit Real Estate

I got an email about buying a Redford home, bankruptcy, and bad credit.  Here is what the email said. 

I don't know what to do, I'm at my wit's end.  I have to have one of the lowest credit scores possible that it is under 500.  I can afford most of the Redford homes that I have looked at.  Most will cost me $300.00 less than the rent that I am currently paying ($800.00 a month) including property taxes.  But my credit is so bad is that I can't get out of the hole, what can I do other than file bankruptcy?  And how will filing bankruptcy affect my chances of getting into one of the homes I like.

 My answer is to this poor guy is:

If you are looking to buy  a Redford home this year you are out of luck, there is no quick fix so you can buy a house.  Sure a credit repair company "MAY" be able get you into a Redford home in six months, but you will be doomed to fail.  Simply because you haven't gotten into the habit of making your payments on time.  I would bet a hundred dollars that you would lose the house in the future.

My suggestion is to take it slow and do it right.  Get into a routine of making your payments on time.  The key in your situation is to file bankruptcy and start over.  But be sure to consult with a bankruptcy lawyer, don't rely on my advice.  You should seek legal advice and make your decision based on their advice.  You have to make a clean start otherwise you will always be in this predicament.  After you file bankruptcy you need to start establishing new credit slowly.  Get one secured credit card and use it to buy gas or groceries.  Pay it off in full each month.

I hate to say it but having a good credit score boils down to making your payments on time.  A good credit score is good credit history.

Now this will take time, but it is the only way.  There is no quick fix to bad credit.  You have to earn it.  You can get a FHA loan 2 years after a bankruptcy.  But you need at least 3 credit lines open for a year with most lenders in this current market.

So don't get upset and feel bad that you can't get credit now.  That you can't buy a home now isn't a bad thing because if you did I would bet you would be in foreclosure within two years.  So start putting your financial building blocks back together.  Bankruptcy first, open a secured credit line, pay your payments in full on time, open a second line after 6 months, don't let anything go over 30 days late.

It's not hard once you put your mind to making your payments on time.  No excuses if you want a home.  So I ask you how bad do you want that Redford home?

My quote of the day is:

For time and the world do not stand still. Change is the law of life. And those who look only to the past or the present are certain to miss the future.

                                                                                            John F Kennedy