Black and Buono Blog

Boomerang buyers are people who lost homes in Boston and Massachusetts in foreclosures and short sales in the historic housing bust, and who are striving to be homeowners again. Their time out of the market may be shorter than many might expect.

People who go through foreclosure can rebuild credit records and qualify for home loans again in three to seven years if they manage their finances well. With home prices still low and interest rates near record lows, today's boomerang homebuyers might even find their next mortgage more affordable than their last one. The reason attributed to a marked increase in these buyers, compared to February 2012, is the amount of households which are emerging from the three year FHA waiting period post foreclosure.

This guideline reads "The three-year waiting period to regain eligibility for another FHA insured mortgage begins when FHA pays the initial claim to the lender; this includes deeds-in-lieu of foreclosure, as well as judicial and other forms of foreclosures."

The three year countdown can be gauged by researching when title was transferred out of the foreclosed owner's name and into the bank's.

The FHA guidelines also require that potential buyers be creditworthy, which means having: a middle FICO score of 640, continuous 2 year work history, likelihood of continued employment, and a 3.5% down payment.

For assistance in buying a new home after foreclosure, contact Black and Buono.