WHAT ARE THE CONSEQUENCES OF
SHORT SALE VS FORECLOSURE?
HOW SHORT SALES & FORECLOSURES DIFFER
Short sale and foreclosure are similar in that they’re both financial options for individuals who own homes but find themselves in financial distress.
A short sale transaction occurs when mortgage lenders allow the borrower to sell the house for less than the amount owed on the mortgage. The foreclosure process occurs when lenders repossess the house, often against an owner’s will. … Furthermore, a short sale is typically less damaging to your credit score than foreclosure, please seek the advice of an attorney or tax professional before making your final decision on either option.
FYI: Short sales and foreclosures differ greatly in their process. Short sales can take up to one year to close, while foreclosures generally move along much faster because lenders are anxious to recover the money they’re owed.
WHAT ARE THE BENEFITS OF A SHORT SALE?
A successful short sale can, in most cases, stop the foreclosure process. Once the sale is complete, your credit will show as “paid in full” or “paid as negotiated.” In a short sale, there are minimal effects to your credit, provided your mortgage was not seriously delinquent (less than 30 days late). A single 90 day late can seriously damage your credit, regardless if the sale is successful or not. In a short sale, part of the transaction usually involves a full or partial release of lien that will protect you from a deficiency judgment.
Short sales are a little like snowflakes…no two are alike. Everyone’s financial situation is different and will determine how quickly the short sale process will be resolved.
WHAT WILL A SHORT SALE COST ME?
FREE TO YOU! M and M Realty Group’s services are paid for by the bank. There are many benefits to you and your bank when short selling your home which may include:
- Avoiding the stigma of foreclosure
- Short sales costs the bank less and they recover more
- Minimal impact on your credit
- Qualify for a new mortgage in as little as 2 years. If your payments were never late, you may be able to buy another house immediately
What are your “costs” for a short sale vs. foreclosure?
With M and M Realty Group there are no out of pocket costs to hire a Short Sale Specialist. Our fee is paid by your lender. All you need to bring to the table is patience and cooperation. Please call us at today (702) 751-5438 to discuss the pros and cons of each option.
- Credit score may drop 200-300 points
- May affect your credit for up to 10 years
- Second mortgage lien holders may pursue you for up to 6 years
- Many landlords may not rent to someone with a foreclosure
- Potential employers may see the foreclosure on your credit
If you are planning to sell your home in the next few months, nothing is more important than knowing a fair asking price. M and M Realty Group would love to help you with a FREE Market Analysis. We will use comparable sold listings (comps) to help you determine the accurate market value of your home.
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