CHICAGO (6/18/15)--The housing market could soon receive a boost, as more than 1.5 million homeowners who got pinched by the financial crisis may have the ability to re-enter the market over the next three years, according to a recent study by TransUnion.
Also known as boomerang buyers, the population is defined as those homebuyers who have been 60-plus days delinquent on a mortgage loan; have lost a mortgage through foreclosure, short sale or non-satisfactory closure; or have received a mortgage-loan modification.
This year alone, roughly 700,000 boomerang homebuyers will have the opportunity to re-enter the market, and over the next five years roughly 2.2 million could rejoin, TransUnion found.
“It’s been over seven years since the beginning of the mortgage crisis,” said Joe Mellman, vice president/head of TransUnion mortgage group. “This is significant because many derogatory items, such as foreclosures and short sales, can prevent consumers from qualifying for a new mortgage for a period of time.
“The timing of that challenge can very: for example, four years must pass after a short sale and seven years must pass after a foreclosure. As consumers responsibly manage their credit and pass these milestones, we anticipate a tide of newly mortgage-eligible consumers entering the market.”
The study looked at the full U.S. credit-active population at the end of 2006, the end of 2009, and in 2014 to determine a consumer’s ability to re-enter the market.