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Helping Boomerang Buyers Get Back on the Market
Have you heard the term “boomerang buyer”?
Simply put, “boomerang buyers” are former homeowners who had some financial issues and were forced to file bankruptcy, foreclose on a home, or sell a home in a short sale. After taking some time to get finances in order, these “boomerang buyers” are ready for homeownership once more.
Does this sound like you?
It’s Time to Buy Again
It’s sometimes difficult to talk about prior issues you’ve had, but now is a fantastic time to buy a home. It’s totally worth it to get back in the real estate game, if you’re financially read to do so.
Here are a few tips for getting back on the market.
Make Sure You’ve Waited Long Enough
Major financial events such as bankruptcy, foreclosure, or short sale require a certain waiting period before you’re eligible to buy again. For example, foreclosing on a home usually comes with a 7-year waiting period, while a short sale requires only 4 years. Extenuating circumstances will greatly shorten these waiting periods.
If you wait until the waiting period has expired, these hardships will actually fall off your credit report.
Pay Down Debt
With all buyers, it’s important to have low debt-to-income ratio. With buyers who’ve experienced past financial troubles, it’s especially important to show you’re not in danger of quickly becoming overwhelmed by taking on new debt.
Don’t Skimp on the Down Payment
The more you can pay upfront, the more willing lenders will be to provide a loan with a good interest rate… and no PMI. Private mortgage insurance is typically required for any loan with a down payment of under 20%.
Check Your Credit First
Before you talk to any lenders, find out what’s actually on your credit report. This will let you know about any potential red flags—or alert you about incorrect information that should be taken care of long before you jump into the homebuying game.
Thinking of Buying Again?
If you’ve had some challenges in the past, just remember: We’re here to help. We’ve been helping clients for over 38 years, and we understand people will always have their ups and downs. That’s why we want to help you circle around to get back into the home buying game.
If you have any questions about what it takes to re-enter the market, please feel free to reach out to us. We can set up a private consultation for you in which we can talk about your situation and what we can do to help.