Posted on: 30th Oct, 2007 03:38 pm
what are the benefits to a short sale and what are the benefits to foreclosure?
Hi Stephanie,
Short selling the property has a far less damaging affect on credit report then letting the lender foreclose it. It reduces the scores by 80 to 100 points. On the other hand, if you go for the second option, it will lower your credit score between 200 to 350 points. To know the credit effects of short selling a property, check out the given page:
http://www.mortgagefit.com/discuss/shortsale-crediteffect.html
Short selling the property has a far less damaging affect on credit report then letting the lender foreclose it. It reduces the scores by 80 to 100 points. On the other hand, if you go for the second option, it will lower your credit score between 200 to 350 points. To know the credit effects of short selling a property, check out the given page:
http://www.mortgagefit.com/discuss/shortsale-crediteffect.html
By short selling your property, you can protect your credit history compared to a foreclosure. Choose it only if it is possible.
Hello Stephanie,
Even I agree with Adonis. If a property is foreclosed upon, then it will have a negative impact on your credit than a short sale. It stays on your report for as long as 7 years. Also, note that after a foreclosure, you won't be able to get a mortgage immediately. You'll have to wait for 3-4 years in order to get a mortgage. To get a mortgage after short selling the property, you'll have to wait for 2 years.
Even I agree with Adonis. If a property is foreclosed upon, then it will have a negative impact on your credit than a short sale. It stays on your report for as long as 7 years. Also, note that after a foreclosure, you won't be able to get a mortgage immediately. You'll have to wait for 3-4 years in order to get a mortgage. To get a mortgage after short selling the property, you'll have to wait for 2 years.
Hi Stephanie,
I agree with all of you that short selling the property has less affect on your credit report than letting it get foreclosed by the lender. But if I have to choose among the three options, the I think deed in lieu of foreclosure is the best because the lender cannot charge me the deficiency money and it also will have less affect on my credit report compared to other options. What do you guys think?
Thanks,
Larry
I agree with all of you that short selling the property has less affect on your credit report than letting it get foreclosed by the lender. But if I have to choose among the three options, the I think deed in lieu of foreclosure is the best because the lender cannot charge me the deficiency money and it also will have less affect on my credit report compared to other options. What do you guys think?
Thanks,
Larry
I'm in a dilemma... My property is underwater and I'm confused which option to chose.... Can you guys give me some suggestions? Please help...
Hi Guest,
In terms of the negative impact on your credit, a short selling the property will definitely be better than letting the lender foreclose it. If the property is foreclosed by the lender, it'll drop your credit score by almost 250 points. In comparison, the other option may lower your scores by approximately 75-100 points. However, if there remains any deficiency from the short selling of the property, then you'll be held liable for it.
In terms of the negative impact on your credit, a short selling the property will definitely be better than letting the lender foreclose it. If the property is foreclosed by the lender, it'll drop your credit score by almost 250 points. In comparison, the other option may lower your scores by approximately 75-100 points. However, if there remains any deficiency from the short selling of the property, then you'll be held liable for it.
Hello… I need help and hope someone out here can be helpful to me….
I'm in a tough situation. About two years back, I bought a townhouse for $180K. Everything was going fine but I lost my job in April. My savings helped me largely and I could pay off the debts till June. My property has now dropped value. I'm unable to pay the dues and I'm planning to walk away letting the lender foreclose the property. Some of my near and dear ones have suggested this option. However, my realtor has mentioned the option of short selling the property. Can anyone tell me how damaging both of them can be? :?
I'm in a tough situation. About two years back, I bought a townhouse for $180K. Everything was going fine but I lost my job in April. My savings helped me largely and I could pay off the debts till June. My property has now dropped value. I'm unable to pay the dues and I'm planning to walk away letting the lender foreclose the property. Some of my near and dear ones have suggested this option. However, my realtor has mentioned the option of short selling the property. Can anyone tell me how damaging both of them can be? :?
Hi BradP,
If you walk away from the property, your lender will foreclose it. This will affect your credit negatively and will lower it by 250 points. Compared to this, short sale is a better option. It will drop your credit scores by around 75-100 points. However, you will remain responsible for the deficiency amount resulting from the sale and the lender may sue you for it.
Thanks,
Jerry
If you walk away from the property, your lender will foreclose it. This will affect your credit negatively and will lower it by 250 points. Compared to this, short sale is a better option. It will drop your credit scores by around 75-100 points. However, you will remain responsible for the deficiency amount resulting from the sale and the lender may sue you for it.
Thanks,
Jerry