Should I Consider A Short Sale?

What is a short Sale?

If you are behind on your mortgage and can no longer afford your home, there are a few different options that you have. One of those options is to do a short sale and save yourself from Foreclosure. Short Sales can save you hundreds of points on your credit score over a Foreclosure. So what is a short sale?

A Short Sale is defined as a situation in which the seller (1) owes more money on the loan (and any other liens on the property) than what the sale of the property will likely produce on the market and (2) is unable or willing to bring money to the closing.

Short Sales. Lenders tend to look more kindly on applicants who have unloaded homes via a short sale, Ferguson said, who is also an acknowledged expert in credit scoring. In fact, she said you may be able to obtain another mortgage in as few as 24 months, depending on the circumstances of your previous derailment. “If you truly have extraordinary circumstances, you can be out there again as soon as two years.” Source: BY LEW SICHELMAN/UNITED FEATURE SYNDICATE

What are the potential credit differences between a Short Sale and a Foreclosure?

Short Sale	Foreclosure
How short sale is reported will affect credit score After short sale, lender can report as: Paid in Full – Paid as agreed Paid – Settled Paid – unrated If the owner is current with other payments, a short sale may only lower score by 50 points	Can lower score by 200 points or more Foreclosure remains a public record and on credit history for at least 7 years

How do I start the process of a Short Sale?

First things first, give me a call at 773-809-5536 or shoot me en email at lnevin@koenigstrey.com to discuss options. We can discuss strategies and get you in touch with a great attorney to help you sort through your options. In most cases, we will want to list your home for sale right away so that we can present the bank with an offer for your home. This will give you the best chance of completing a successful Short Sale transaction.