By Nef Cortez
“Boomerang Buyers”, homeowners that lost their homes through foreclosure or were forced to sell their homes as “Short Sales”, are re-entering the market. The peak of foreclosure notice filings-bank repossessions, scheduled auctions, and default notices-occurred in 2010, passing the 2,870,000 mark. It surpassed the previous year’s record number of 2,300,000 filings. The total number of filings since the mortgage meltdown begin to hit the housing market in 2005 stands at more than 19,000,000.
Homeowners that lost their home typically are required to wait 7 years before they would qualify for any of the Government Sponsored Enterprises (GSEs) such as the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), as well as the Housing and Urban Developments’ FHA program loans.
With approximately one third of all filings in 2010 having led to an actual bank repossession, at least 700,000 homeowners who lost their homes are now able to qualify for loans, based solely on that criteria. There are an additional 500,000 that also went through a short sale and would also now qualify for these government sponsored programs. They need to have repaired their credit by establishing a good payment history since their repossession distressed sale in order to qualify in the now existing tighter credit environment.
This pool of more than 1,000,000 buyers, which represents close to 20% of the total number of home sales in the US this past year, will provide a further upward push on home prices by being able to compete with the already existing pool of homebuyers. This pool of buyers will continue to grow as those who lost their homes through foreclosure after the peak in 2010 also begin to re-enter the home buying market.
This article was written by Nef Cortez who is a licensed Real Estate Broker, Ca BRE # 00560181, licensed since 1976. He can be reached for more information via e-mail at firstname.lastname@example.org, or website http://www.nefcortez.com. Please feel free to email any questions regarding real estate.