Nearly a decade after the end of the mortgage bubble that tanked the economy, millions of homeowners negatively impacted by the financial crisis are poised to re-enter the housing market.

More than 2 million homes owners who lost their homes to short sale or foreclosure or fell seriously delinquent on their mortgage payments will be able to re-enter the mortgage market in the next five years, according to a new report from TransUnion.

The time needed for a credit score to fully rebound depends on how severely the bust impacted the homeowner, and what they’ve done to rebuild their credit since. A foreclosure can remain on a credit report for up to seven years, but the impact diminishes over time.

One quarter had been through foreclosure

In California, one of the states hardest hit by the foreclosure crisis, nearly a quarter of repeat homebuyers in 2015 had previously been through a distressed sale, according to the state’s realtor association. For nearly eight in 10 of those buyers, the foreclosure occurred after 2008.

Of course for many people who lost homes to foreclosure, there were other circumstances that could have led to additional credit damage. If homeowners lost their jobs in the financial crisis they may have fallen behind on other debts like student loans and credit cards. Keeping up those payments would be a necessary step in rebuilding credit.

Even if former homeowners have fully repaired their credit, it’s unclear whether they’ll jump back into the market. Nearly 60 percent of consumers who could meet mortgage agency guidelines have not yet re-entered the market, TransUnion found.

Those who do choose to wade back in will find a very different market from the last time they purchased a home. Mortgage standards and underwriting guidelines are far stricter and competition is fierce. “They may find themselves discouraged,” says Trulia chief economist Selma Happ.

Shopping for a mortgage is critical

It always makes sense to shop around for a mortgage, but it’s especially important for borrowers with a foreclosure history. Various banks may have different rules around how long borrowers need to wait after a foreclosure, how much money they need to put down, and the rate they can qualify for.

“Some banks that were hit harder during the financial crisis may have more restrictive guidelines,” says Ray Rodriguez, a regional mortgage sales manager with TD Bank. “Some banks, if you went through a foreclosure with them, may not want you back as a customer.”

Contact Keith Katzman: 925.376.7776

Looking to buy or sell a home in the Lamorinda community? Contact Keith Katzman–a Moraga native with more than 30 years of industry experience.