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Your Newest Clients: Boomerang Buyers

According to TransUnion, “During the mortgage bubble in 2006, 78 million consumers, or 43% of credit-active consumers in the U.S., had a mortgage. More than 8% of these consumers were “impacted,” defined by TransUnion as those who were 60+ days past due on a mortgage loan, lost their mortgage through foreclosure, short sale or other non-satisfactory closure, or had a mortgage loan modification between the Bubble and Burst.”
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Source: TransUnion

Source: TransUnion

TransUnion found that approximately 700,000 “Boomerang Buyers” who went through a foreclosure, short sale, loan modification, 60-day delinquency, or other problems during the foreclosure crisis beginning in 2008 may qualify for a mortgage loan this year.

These Boomerang Buyers may qualify for loans now thanks to time: Credit scores have had time to improve, and these former homeowners are meeting minimum waiting periods required by lenders such as Fannie Mae, Freddie Mac, and the Federal Housing Administration. 

 

2.2 million homeowners will re-enter the market before 2020

Source: TransUnion

Source: TransUnion

 

 

Survey Reflections from Champions Instructors

“I think the survey reflects a changing world with regards to home buying.  Along with the instigation of TRID this week we will see buyers coming back to the “new world” of home buying and being more cautious as well as wanting more information.  My prediction is they will become more immersed in the process. That will be driven by the fact the process will be so much different than what they may have experienced in the past. For first time buyers it won’t be so much of a change.  They will learn the new process organically.”– Champions School of Real Estate Instructor Thom Hulme

 

 

Additionally, the Texas Association of Realtors had the following advice for Realtors working with buyers re-entering the market:

  • Boost their confidence. They may have more worries about purchasing a home than your other buyers. Emphasize the benefits of homeownership, and reinforce their decision to buy again.
  • Explain how loan application and approval have changed. Buyers have to do more now to show they are responsible and qualified to borrow a loan, so be prepared to help your return buyers navigate this new-to-them process.
  • Focus on fixed-rate mortgages. NAR research finds that return buyers prefer stable products, and 92% of these buyers used a fixed-rate mortgage product in 2014.


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This entry was posted in Testing by Karla Lárraga.
Karla Lárraga

About Karla Lárraga

Karla Lárraga is the Communications Director for Champions School of Real Estate® and Champions School of Business Etiquette® statewide. With active social media channels on Facebook, Twitter, Google+, Pinterest and more, Karla enjoys sharing everything Champions - be sure to stop by and say hello or drop her a note at Karla@ChampionsSchool.com.

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