Short Sale VS. Foreclosure
Which is the Better Option?
Losing your home to due to an inability to keep up with your Monthly Mortgage Payments is one of life’s most unpleasant experiences. It is also an event that keeps on affecting you long after your home is history by devastating your credit score. Regrettably, most people cannot be 100% sure that they will remain safe from Foreclosure because they cant foresee the unexpected. Occurrences such as serious illness, a major accident, divorce or job loss can happen to anyone. So, it’s a good idea to understand the available alternatives should the worst occur. Of all available alternatives, foreclosure is the worst!
Consider a Short Sale and Its Advantages:
A Short Sale is a popular option for homeowners faced with a hardship and lack of equity. In a Short Sale, you would sell your home for less than what you owe your lender(s), the lender will pay for your Realtors services and pay for any of your delinquent Property Taxes and/or HOA dues.
Will you be able to purchase a home in the future?
- Short Sale: Yes, with help from a Credit Repair Specialist you can own a home again in as little as 2 years.
- Foreclosure: A minimum of 5 years must pass before Fannie Mae/FHA will loan money to a Buyer with a past foreclosure.
How will your credit be affected?
- Short Sale: Because the mortgage will be satisfied and reported as paid, only late payments will be reported under ‘Derogatory Items’. This can lower your credit score minimally compared to a foreclosure which typically lowers your credit score 50-250 points.
How Will this Affect my Employment Opportunities?
- Short Sale: Many employers are now checking credit reports as part of the application process. Because a short sale is not reported, the only thing that will effect an employment credit check is the late payments.
- Foreclosure: Because employment is public record, it may affect your chances at employment for up to 10 years.
Almost ANY Option is Better than Foreclosure
Simply stated, do everything you can before foreclosure occurs and do it as quickly as humanly possible. Don’t sit back and keep thinking “What can I do?”. Instead, consider a short sale before your options become limited.
Short Sale Pro - 11/17/08
