short sale affect credit
How will a short sale affect my credit long term?
I am stuck in a situation in which I am upside down on my home and with a new baby on the way I need to buy a bigger home and also take advantage of the low mortgage rates and cheap home prices, therefore I am leaning towards doing a short sale. Only thing is that before I go forward with it I want to know what long term affect with it have on my credit? If any. Thanks.
Hi,
Well, a short sale is definitely a negative on your credit and it is up to the mortgage company how they want to state it on your credit report. It is definitely much better than a foreclosure or a bankruptcy, as those both will be on your report for 7 years. I believe many banks will report it as “account closed by account provider” or something along those lines. Yes it will be a red flag but if you can justify your hardship it will be easy to overcome in a couple years.
Overall a short sale is ideal for someone in your situation. Make sure you have a reputable person who knows what they are doing (if it isn’t you) and follow the process very closely.
Also, you can ask the mortgage company what they will be reporting to the credit agencies.
http://www.shortsaleway.com
How Foreclosure vs Short Sale affects credit Explained in Hemet