A bankruptcy filing delivers a devastating blow to your credit and FICO score, but it doesn’t mean you have to wait 10 years before you can qualify for a mortgage. Many consumers who have filed for bankruptcy have been able to obtain a mortgage, although it is often at a higher rate than someone qualifying for a prime or "A-paper" loan.

While credit card companies may care about what happened before you filed for bankruptcy, many mortgage lenders are more interested in your recovery — what you’ve done since your filing. It won’t happen over night, but here are some tips and things to keep in mind when you inquire about a mortgage with a tarnished credit past:

Give explanations. No mortgage lender is going to ignore the fact that you’ve filed bankruptcy and he or she will likely want to know the cause of the filing. Your lender will be particularly interested in whether the same situation could happen again. Your chances of being qualified are much better if your bankruptcy was caused by a single event such as a loss of employment or a death in the family, than if it was the result of “just spending too much.”

If the bankruptcy resulted from a single event, it is important to show your lender paperwork describing the incident, such as the layoff notice or death certificate. You may also want to bring in court documents to indicate when the bankruptcy was filed.

Demonstrate good money habits now. Many people who file bankruptcy swear off credit altogether, however, it is important to re-establish your credit rating. Get a secured credit card or take on some sort of loan — furniture, a car or a major appliance — to demonstrate that you are able to make timely payments. Make sure you are making other payments (utility bills, cell phone, etc.) on time as well. You won't turn things around in a year but your credit score will improve over time.

Dispute any credit report errors. There’s no need to add to your troubled credit history with errors on your credit report. Get a copy of your credit report from each of the three major credit reporting agencies: Equifax, http://www.equifax.com; Experian, http://www.experian.com; and TransUnion, http://www.tuc.com. If you encounter any errors, inform the CRA in writing what information you believe to be inaccurate and request deletion or correction.

Save your money. Lenders may be more willing to loan you money if you’ve saved up a considerable amount of money for a down payment.

Live within your means. Even subprime lenders won’t risk loaning you money for an opulent oceanfront mansion. Think small when the time comes to look for a home. Smaller homes often mean smaller mortgages.

Getting a new mortgage IS possible. Lets look at the guidelines that are in place currently as of 2010.  These will be helpful to understand if you are seriously seeking a mortgage and don't know when or if you are eligible to apply.

• Chapter 7 Bankruptcy. All Government loan programs require that a time period of 2 years have passed since the filing date.  Most Non-Governmental programs, or conventional lending, requires that a time period of 4 years has passed since the discharge. If you have at least 2 years since your bankruptcy discharge, and have taken some steps towards rebuilding your credit, then you should seriously consider applying for a getting qualified for a mortgage.  Don't delay.  If you are not ready due to having insufficient credit, your mortgage banker can advise you on the necessary steps you can take to insure you can and will get that mortgage you need.  You are probably closer than you think to getting a new mortgage.

• Chapter 13 Bankruptcy. All Government loan programs require that at least 12 months have passed since filing this type of bankruptcy AND you have a minimum of twelve timely payments to the court trustee. The trustee is the person who is handling the bankruptcy payments and creditors for you and the legal system while you are paying past debt off. If the trustee feels that your payments on a new mortgage will not put you at risk for making the bankruptcy payments, then the trustee can "sign off" on a mortgage application. In other words, if the trustee says it is ok to apply for a mortgage, then that is all the approval you need from the court system. So if you have made twelve timely payments to the court and have some credit re-established, then you should certainly consider getting qualified for a new mortgage today.

If you have filed bankruptcy in the past and have gone without owning a home or refinancing your current one, you have waited long enough. The time to take action is now. Homes are at all time historic low prices and interest rates are lower than ever before. Whether you want to purchase or refinance, we can help you achieve your mortgage goals.