Let’s start with the bad news first. According to CoreLogic, from 2006 to 2014 “there were 7.3 million housing foreclosures and 1.9 million short sales.”
The hesitation many Americans feel after experiencing a foreclosure brings to mind the old saying: “Fool me once–shame on you. Fool me twice—shame on me.”
According to the 2019 Home Buyer Report from NerdWallet,
“Thirteen percent of Americans have lost a home due to a financial event such as foreclosure in the past 10 years. More than 6 in 10 of them (61%) have not bought a home since, and 20% of those who haven’t repurchased say they never plan to again.”
This makes sense. Would be home buyers don’t want to go through the same pain again. As a cornerstone of the American dream, nobody wants to lose home ownership.
But now for the good news. It’s kind of like this: Remember learning to ride your first bike when you were a kid? Did you give up after you fell and scraped your knees? Or did you get back on the bike and try it again until you could ride without falling?
Now granted, purchasing a home after a foreclosure is not as simple as learning to ride a bike, but the concept is similar. Fear is the blocker. You need to get beyond the fear of another setback and simply look at the financing options available for your next home purchase. A previous foreclosure may require a waiting period for a loan, but the likelihood is that if you are determined, you will get another home loan. In other words, get back on that bike and ride-baby-ride.
As we’ve mentioned before, home ownership has many financial and non-financial benefits. Each potential home buyer needs to go over the pros and cons, taking the time to figure out what is best for their family. Should they continue renting, or should they try to buy again?
The good news is that some “boomerang buyers” are getting back into the market. They’re getting back on their bike!
“Of 2.8 million former homeowners whose foreclosures, short sales or bankruptcies dropped off their credit reports from January 2016 to November 2018, 11.5% have obtained a new mortgage, according to a study by credit rating agency Experian for USA Today.”
NerdWallet’s report also mentioned:
- 6% plan to buy a house this year.
- 39% intend to buy over the next 3 years.
- 58% say they will purchase within 5 years.
If you lost a home due to a financial event but now want to review your options, let’s get together to help you create a plan to obtain a home in the future.
Copyright 2019 James Bradley. All rights reserved.