Wednesday, December 9, 2009

How will a short sale or foreclosure affect my credit score?

A foreclosure is almost as bad as bankruptcy for your credit score. Your fico score could decrease by several hundred points and the foreclosure stays on your credit for 7 years. A short sale is far less damaging to your credit score than a foreclosure. The downside to a short sale is that it is frustrating and time consuming to work with the bank, however if you hire a good Fairfield County Real Estate Broker like Jason Milligan they will take care of most of the details. Short Sell My Home

Generally the way a short sale will appear on a credit report is as some type of settlment. "Paid off for less than than owed", "Paid for less than agreed" or a "pre-foreclosure in redemption". You will also have a few late mortgage payments that show up on the credit report. It is possible to negotiate with the bank about what exactly is reported to the credit bureau's.

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