How Does a Short Sale Affect Your Credit? 

Many Bradenton - Sarasota, Florida homeowners are facing the risk of foreclosure in our declining market. For some, a short sale may be the solution.

The credit score of the seller will take a bigger hit by going through foreclosure or giving a deed-in-lieu of foreclosure than with a short sale. In fact, a short sale may result in a loss of about 100 points on the borrowers FICO score. A foreclosure or deed-in-lieu of foreclosure may result in a lost of 250 points of more.

Most people, when faced with the possibility of foreclosure, find a short sale to be a better solution.  In my previous posts I covered all of the options that a Bradenton, Florida homeowner needs to consider. I always recommend that the homeowner discuss their situation with their attorney and their accountant.

Also to be considered is how long a borrower must wait before they buy another home.
A foreclosure may force the borrower to wait as many as 36 months before they can comfortably buy again. However, with a short sale, the borrower can buy again in about 18 months.



(Copyright © 2007 By Dan Forbes, All Rights Reserved. This material is excerpted from Everything You Need to Know About Short Sales, by Dan Forbes)