Dubbed the “boomerang buyers” by the Wall Street Journal, an estimated 1.5 million boomerang home buyers may be able to purchase a home again by 2014, even though they went through a foreclosure or short sale.The number today is pretty large and you should already be seeing a lot of buyers, in such situations, approaching you to get them into another home.
Boomerang Buyers are coming back!!!.We got 4 applications, just last week, from home buyers who had short sales /foreclosure in the last few years.This post is not about the requirements for such buyers ( Just for clarity we have tabulated the time requirements towards the end of the post.)
Many of these buyers will get qualified if they meet the time period requirements and the DU engine approves them.
Careful analysis of the credit showed that the previous mortgage history was not reported accurately by the previous lender and/or lenders and as such messed up the automatic decision of the DU engine.Unfortunately even though underwriters may be able to see the incorrect reporting they are not able to do much since an auto approval is normally needed to make the loan salable to the pool.
If you have buyers who seem to have spent the time requirements per the norms below and are yet not getting approved ,feel free to send them our way .We can quickly determine if the problem relates to inaccurate reporting, which could be quickly fixed.
Minimum Time Period
Two years for buyers who have:
- Suffered a short sale, with 20% down
- Had a deed in lieu of foreclosure, with 20% down
Three years for buyers who have:
- Suffered a foreclosure ,for an FHA or VA Loan
- Suffered a short sale and are not willing to put 20% down ( Only eligible for FHA or VA Loan)
- Suffered a deed in lieu of foreclosure (Only eligible for FHA or VA Loan)
Four years for buyers who have:
- Suffered a short sale and only have 10% to put down but do not want an FHA loan.
- Had a deed in lieu of foreclosure and have 10% but do not want an FHA Loan.
Seven years for buyers who have:
- suffered a foreclosure,and want a government-backed Fannie Mae or Freddie Mac loan per regular guidelines with no overlays
- suffered a short sale and have less than 10% to put down for a Fannie Mae or Freddie Mac loan per regular guidelines with no overlays.
- those who had a deed in lieu of foreclosure with less than 10% down for a Fannie Mae or Freddie Mac loan per regular guidelines with no overlays.