Purchasing a Home as a Discharged Bankrupt
Pursuant to Canadian bankruptcy legislation, there are many considerations with respect to purchasing a home in a state of undischarged bankruptcy.
While you may be able to buy the house, it is subject to some caveats.
Essentially, you need to find a financing arrangement where the party lending you the funds is aware of your bankruptcy.
It is illegal to gain credit exceeding one thousand dollars while failing to disclose your undischarged bankruptcy.
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There are other considerations as well.
The Trustee in charge of your bankruptcy will want to know from where you got the money to pay for the down payment on the home.
In the event that the funds are received as a gift, then they are eligible for seizure while you are still in an undischarged state of bankruptcy.
Considering the above, it is probably best to hold off on buying a home until the bankruptcy is discharged in full.
Once that happens, you can commence the credit rebuilding process.
Generally, this is done by obtaining a secured credit card which is a simple task once the bankruptcy is discharged in full.
With that in hand, you must use it and pay the balance each and every time.
You will also want to save funds for a down payment for the home you seek.
In this country, you must pay at least five percent of the total price of the home.
The more you issue for a down payment, the better.
To learn about your options, discuss your interests with the Trustee in charge of your bankruptcy.
They will provide you with the necessary details to make a responsible and informed decision relating to your future home purchase – one that lets you discharge your bankruptcy and still work towards your dream home.
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What is Bankruptcy?
How Does Bankruptcy Work?
What is the Cost of Bankruptcy in Canada?
How to Rebuild Credit Following Bankruptcy
Personal Bankruptcy in Canada
What Debts are Erased in Bankruptcy?