If you had a foreclosure, you may still be feeling rattled. Foreclosure is a traumatic experience that takes a toll on you mentally, emotionally, and financially. Losing your home means losing stability, your heart, and your safe-haven.
But don’t fret. Research has shown that many buyers return to the market in as little as two years after foreclosure. Bouncing back in such way that they earned the endearing nickname “boomerang buyers.”
So no matter your situation, it’s important to remember that there is life after foreclosure. Here are some strategies to help you.
Let Time Pass
It’s important to wait it out before rushing back into buying a house. The old adage “time heals all wounds” is especially apt after foreclosure. There’s nothing wrong with dreaming of moving back into a home, and making it your long-term goal, but your first priority should be re establishing your financial life and creating the stability you lost.
Rebuild Your Nest Egg
If your foreclosure was due to no fault of your own, like an illness, financial problems, or loss of job, rebuilding your economic stability should be your next priority. While most lenders will have you believe that your credit is priority number one, they aren’t always looking at the full picture. Your savings can speak volumes about your character too, and replenishing it is as important as repairing your credit during the early stages.
Avoid a “Deficiency Judgment”
Owing money on your old mortgage can halt the buying process on a new home. Sometimes the money leftover from your foreclosure isn’t enough to cover the remaining mortgage. This leaves you owing the difference and is referred to as a “deficiency judgment.” This hangover, as some analysts call it, can be the difference between qualifying for that next mortgage and waiting a few more years. Figure out where you fit in and take steps to fix it.
Take the Fast Track
Recently, legislation was passed that made it possible for people to acquire a mortgage in as little as 12 months, effectively banishing the 3-year waiting period. Funded by the FHA, and called the “Back To Work” program, borrowers can get an FHA-funded loan even if they experienced a recent foreclosure. But in order to qualify, you must meet a few eligibility requirements; click here to find out how to qualify for your certificate and for more information regarding the process.
A foreclosure may seem like the end, but rest assure that there is still light at the end of the tunnel. Think of it as a fresh start, a new beginning with you in the lead clearing a path to your new life.
For more information on how we can help you, don’t hesitate to connect with us. Our loan officers are educated on FHA eligibility requirements and will help you through the process.