Short Sale vs Foreclosure
Ask Kate about Short Sale vs Foreclosure - Did short sale mess with my credit scores? Hi Kate, Even with excellent credit, we can't refinance due to previous short sale.
We have excellent credit, but also had a short sale about 4 months ago.
But we had no other options because we had moved out of state and could not sell and had troubles renting. Our renters left with unpaid bills we had to pay, house needed repairs, and we could not keep up with the payments because of all that.
Now our bank won't even talk to us and all other lenders tell us there is nothing they can do for us. Is there no program (government) that we qualify for???
Kate Answers: Short Sale vs Foreclosure - Will short sale be better for my credit scores?
I don't like to be the bearer of bad news, but excellent credit is now in the past tense, at least for a couple of years.
With a short sale, the property is sold for less than the full amount of the mortgage. So the lender does not recoup his money.
Because the short sale is reported to the credit bureaus, the seller's credit history is affected. The bottom line is that a short sale wreaks havoc with credit, very much the same as going through a foreclosure.
How To Recuperate From Short Sale - Loan Modification & Credit
But if you have spent much time at all on Get Your Best Mortgage Rate, you know I am persistent and encourage my Readers also in this respect. So while it's true that you may be waiting a couple of years to refinance, I don't suggest sitting on your hands.
In the meanwhile, ask your loan servicer about...
Educate yourself by...
In an opposite situation, you might be interested to read this letter from a homeowner pursuing a loan modification before
a short sale as well as my response... Negotiating A Short Sale After Loan Modification
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