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Homes sell to onetime owners who fixed credit

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TRINITY, Fla. » Tears still spring into Debbie Cooley-Guy’s eyes when she thinks about her dream home, with its wide, sweeping porch. It overlooked a bayou filled with wading birds, a glittering blue pool and the space for not only a 12-foot Christmas tree, but also a grand piano.

She bought the home in a suburb west of Tampa for $637,000 in 2002. Seven years later, after the economy tanked, she sold it for less than she owed on her mortgage to avoid foreclosure.

She recalls the black moment when she was still caring for the lawn but not living there. A falling branch knocked down an outdoor staircase railing.

“It made the house look so sad. I was so sad,” said Cooley-Guy, 60. “I drove away crying. I just didn’t think it was how the story would end with this house.”

On that dark January day, Cooley-Guy thought her home-owning days were over.

Just a few years later, she’s back in a new, smaller home, one of America’s growing ranks of “boomerang buyers.”

Seven years after the real estate bust, many who lost their homes have rebuilt their credit and are back in the market. Experts say these boomerang buyers will be an important segment of the real estate market in the coming years.

About 700,000 of the 7.3 million homeowners who went through foreclosure or short sales like Cooley-Guys’ during the bust have the potential to get a mortgage again this year, said Daren Blomquist, vice president of Realty Trac. That compares with the 3 million people overall who got a mortgage between October 2013 and September.

A recent increase in loans from the Federal Housing Authority also shows first-time homebuyers and boomerang buyers are helping drive the market, Blomquist said.

It generally takes seven years for a foreclosure to drop off a credit report. Short sales take less time, generally three or four years.

Greg McBride, a chief financial analyst at bankrate.com, said it’s difficult to tell whether boomerang buyers are affecting the market — at least this year.

“The prices are rising because of the limited inventory,” he said. “Boomerang buyers are part of the demand but not a huge component.”

In the coming years, though, as foreclosures continue to drop off credit reports, more people will get back in the market, analysts said.

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