Changes to the Federal Housing Administration guidelines and Fannie Mae’s loan approval system have opened the door for “boomerang buyers” to own homes again. Boomerang buyers are former homeowners who are able to buy again just one year after foreclosing on a home.
Boomerang buyers, surprisingly, may just be necessary to maintain a growing economy. Real estate investors are likely to slow their purchases as prices increase. College graduates may not have the ability to buy, with looming student loan debt. Underwater homeowners– who are unable to sell and move up– are also stuck.
The Federal Housing Administration’s “Back to Work” program aims to approve certain buyers, despite histories of foreclosure, short sale, or bankruptcy. Prior to this program, these buyers had to wait two or three years before buying again.