Recent credit history more important for getting home loans - Bills.com News

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Recent credit history more important for getting home loans

Wednesday, Aug 26, 2009

Having gotten through bankruptcy, some people may feel as though they've made it through tough financial woods.

However, when applying for loans from banks, some consumers may notice that applications have changed their wording with regard to bankruptcy. In a recent column for the Philadelphia Daily News , Harry Gross responded to a reader's concern regarding the fact banks are asking if people have ever been through a bankruptcy.

Before the change,banks would ask consumers if they had gone through a bankruptcy in the past 10 years. Gross said that though the wording has changed on loan applications, banks are more likely to pay attention to a consumer's more recent credit history.

"Let's give the bankers credit for a bit more intelligence," Gross said. "They will give far greater weight to your recent creditworthiness."

More people may be
turning to bankruptcy as an option for dealing with their financial problems. According to the American Bankruptcy Institute, bankruptcy filings for July were up by 8.7 percent over June, and were at the highest rate seen since new bankruptcy laws were enacted in 2005.

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