There’s a new term in real estate to know – boomerang buyers. This is the term the Wall Street Journal has coined for people who have gone through a foreclosure or a short sale and are ready to be a homeowner again. They have come through the rough patch and are back in the market. Over three-quarters of a million foreclosed borrowers are eligible to apply for an FHA mortgage. It’s not an automatic thing, and depending on whether you’ve gone through a short sale or a foreclosure and who the lender is, there are different rules to follow, but the point is, it’s possible.
In either case, there is going to be a waiting period and a minimum credit score to qualify. In general, a short sale has less of an impact than a foreclosure. Late payments cause the most damage, and since foreclosures take longer than short sales, the damage is more dramatic. Also, a “settled” debt is less damaging than a “defaulted” debt.
Read the entire article here.