If you have been faced with a foreclosure of your home, it will generally take about three years for you to be able to own again. It is very important that you begin to prepare for this as soon after the foreclosure as possible. It is also just as important to be consistent in the tasks to be done for the three years leading up to home ownership. This article will explain a number of things you can be doing during this "waiting" time.
Before you can do anything it is necessary to make sure that the foreclosure has been finalized. The home must have been re-sold or the loan satisfied in order to consider the foreclosure complete. The next step to take is organizing a financial budget with all household members. When making this budget make sure you are leaving well within your means. Include in the budget all miscellaneous items that you can expect each month. Be sure to allot a certain amount of money for extras. Most importantly stick to the budget.
You will be spending a lot of time reviewing your credit reports with the three major credit reporting bureaus, Equifax, Experian, and Transunion. Take advantage of the free credit reports you are entitled to each year. You can access this information on each of the bureaus web-sites. If you notice any errors on the reports be sure to contact the bureau to have it corrected or deleted from the file. Avoid eating out since this is an unnecessary expense that adds up quickly. Do not buy things with credit cards unless you are sure you can pay the bill in full within that month. Checking your credit report and obtaining your credit score does not affect your credit standing so be sure to check it often. The loan companies and banks are going to look at job stability so try to avoid changing employers during this three year period. This is a good time to learn as much as you can about budgeting and financial stability. Learn as much as you can by reading book and material on the internet. Consider taking some financial courses that are often times offered for free at your local parks and recreations department.
Pre-paid credit cards can be helpful with re-establishing ones credit worthiness if it is used properly. There is quite a bit of information available on the internet speaking about the correct way to use these pre-paid credit cards for the purpose of re-establishing. Be sure to familiarize yourself with this fully before jumping in feet first. Find out if the credit card company reports to the three major credit reporting bureaus. It is important they do report to the bureaus since you are using this as a means to re-establish. Use some common sense and follow these tips and you will find your way back into home ownership.
Published in: Personal Finance