Markets & Economy

New credit scores could bolster housing market

NAR: 1.5 million 'boomerang' buyers will purchase homes in next 5 years

The National Association of Realtors says that the adoption of new credit-scoring models could improve the ability of borrowers who lost their homes during the foreclosure crisis to buy again. Nearly 1 million of the 9.3 million homeowners who underwent a foreclosure, received a deed-in-lieu of foreclosure or sold their homes in a short sale between 2006 and 2014 have already purchased a home again, according to a new study by NAR. Demand from so-called "boomerang" buyers will continue to bolster the housing market in the years ahead, with an additional 1.5 million consumers from the group analyzed by NAR expected to become eligible for a mortgage and purchase a home over the next five years, NAR said. But damaged credit profiles and strict lending standards will continue to keep millions of would-be buyers on the sidelines. If lenders warm up to new credit-scoring models, however, many borrowers locked out of the housing market could re-enter it, according to NAR...