How soon can you get a new mortgage after filing for bankruptcy in New Mexico? Most likely faster than you think. There are lenders who won't be against working with you right away after your bankruptcy is over. Still, you might be better off if you wait for a short time.
Right After Bankruptcy, Refinancing
Even though you can refinance right after filing for bankruptcy, you won't be able to get the most out of it. If you just filed for bankruptcy, you will have to pay a high interest rate. If the rate is higher than the rate on your current mortgage, you may end up spending more money. Before you refinance your New Mexico mortgage, you should take the time to rebuild your credit unless you are facing foreclosure or need to borrow against your equity.
Six Months After Filing for Bankruptcy
If you started to fix your credit right away after filing for bankruptcy, you should see a change in your score within 6 months. This could be the best time to refinance if your credit score is high enough. A New Mexico mortgage refinance after bankruptcy can let you start over with your mortgage, get you a lower rate, and give you a chance to rebuild your credit.
Two to Three Years After Bankruptcy, Getting a New Loan
Your credit score should be back to normal and closer to the New Mexico average of 663 within two to three years after you file for bankruptcy. This means that you can get a conventional loan, which has rates of 5.63 percent right now. If you are paying an interest rate of 8 or 9 percent right now, you could save a lot of money over the life of your loan. Depending on how much you borrowed, you could save $100 to $200 each month. Just think of all the money you could save, invest, or use to pay off other debts if you didn't have to borrow.
