The FINANCIAL -- The first wave of nearly 7.3 million potential boomerang buyers who lost their homes to foreclosure or short sale between 2007 and 2004 are entering the real estate market as repeat buyers, according to RealtyTrac data.
The Housing News Report takes a look at boomerang buyers in the April 2015 issue. Here’s a short excerpt from Housing News Report executive editor Daren Blomquit’s story titled: “Boomerang Buyers: Recovery or Repeat?”
“The housing story of Joann and Oscar Flores over the past 13 years is one of a rollercoaster relationship with homeownership — closely shadowing the ups and downs of the U.S. real estate market during the same time period.
The Flores family first became homeowners in 2002 with the arrival of their first daughter, moved up into a bigger house in 2004 with the arrival of their second daughter but then lost that home to foreclosure in 2008 after their housing payment nearly doubled and they had no equity to refinance into a better loan.
In 2015 they became homeowners once again after nearly seven years in renter purgatory.
“The neighbors were horrible,” Joann Flores said of the townhome the family rented, opting for that instead of renting a single family home so they could save up to buy again. She said the neighbors would complain when her daughters played in the common area of the community because they had no yard to play in. “This was a sacrifice. This was going to motivate us to get out.”
And get out they did, closing on a home five miles from the home they lost to foreclosure and in the same school district. Their new home has four bedrooms and three bathrooms — just like the one they lost to foreclosure nearly seven years ago — but the new one has a pool.
“If it doesn’t have a pool, don’t show it to me,” Joann recalls telling her agent, Bob Irish, a broker with Lake Hills Realty who also worked with the family back in 2008 to try to sell their former home via short sale to avoid foreclosure.
No script for saving homes
That short sale attempt didn’t work out even though in hindsight the bank would have been better off agreeing to a short sale, according to Irish, who said an offer was submitted for $420,000 that the bank refused in favor of foreclosure — only to sell for a much lower price after foreclosure. Public records from RealtyTrac show that after obtaining the property through foreclosure on Oct. 17, 2008, the lender, “US BANK NA SERIES 2005-11″, sold it to a third party on Aug. 14, 2009 for just $215,000.
Joann Flores recalled at the time watching a speech by President Obama in which he said banks should work with homeowners to avoid foreclosure. After watching the speech she called her bank asking what help they could provide only to be met with an underwhelming response.”