Short Sale Vs. Foreclosure – Which One Is Best?
May 26th, 2009 categories: Foreclosures, Seller Resource
“We have to relocate from Sonoma County because of my husbands job. Our home value dropped over $100,000. We don’t want our home to go to foreclosure. Someone mentioned the short sale as a possibility. What impact would a short sale have on our credit?”
A short sale, when you sell your property short for what is owed to the lien holders, can have a dramatic impact on your credit score. According to John Ulzheimer, president of consumer education for Credit.com, a person’s credit score could drop up to “200 points”, essentially the same decrease as if a homeowner had gone into foreclosure. The negative mark can affect the credit report for up to seven years.
“if you’re underwater on your mortgage and you need to move, a short sale is a better option…”
According to Geri Willis, a contributing writer and host of CNN’s Your Bottom Line, “if you’re underwater on your mortgage and you need to move, a short sale is a better option than foreclosure.” Getting a loan will be more difficult if you go through foreclosure rather than a short sale. According to professional sources going through a foreclosure will keep you from qualifying for a new mortgage for three to five years, whereas, a short sale will enable you to qualify for a new mortgage within two years.
Call me for anymore questions you may have, 707-771-0338.
