Credit Penalties Of A Short Sale
Are there some credit penalties of a short sale?
-Yes, there are credit consequences with a short sale. Just like any loan, if you are missing payments on your mortgage you are going to have damaging marks on your credit for missing those payments. Now with a short sale, lets say you miss a couple payments. You are going to have negative marks with a short sale. Nonetheless, if you go through the whole foreclosure route you will have a lot more damaging marks since you will most likely miss added payments. In addition, when you do close a short sale there will be something on your credit report that will declare debt settled or debt settled for less. While, if you have a foreclosure on your credit report it is going to say debt not settled or foreclosure or something of that nature. So, you will be much better off completing a short sale because the marks on your credit will be a lot less.
In addition worth noting, Fanniemae at the moment has a rule out there that if you complete a short sale you can buy another home after a 2 year period. Yet, with a foreclosure you are going to need to put off for five to 7 years before you buy a house again.
So, while there are negative penalties from closing a short sale, those damaging penalties are far fewer than the result that a foreclosure would have on your credit. The short sale is basically a better resolution for the property owner and the lender.
Contact Josh or Sarah to talk about some questions that you may have in relation to your credit and they can help you openly see the benefits of a short sale to get your money back on the correct pathway.
Furthermore, check out our other video blog sessions to learn more about the short sale procedure and how you can benefit from closing a short sale with Josh and Sarah.
Get more help from short sale Realtors, Josh and Sarah, at Short Sale Shift presented by the Short Sale Specialists of Minnesota