I had a client ask me how a short sale affects credit, so I googled and found severa sites. This was the first one and thought it was good article:
http://homebuying.about.com/od/4closureshortsales/qt/060907SScredit.htm
It is confusing figuring out what to do when sometimes banks say you have to be in arrears to do a short sale, whereas at other times you are told to stay current. It appears that being in arrears and how far you are in arrears makes the biggest ding on your credit.
I have a client who was just approved after a short sale 2.4 years ago and her FICO is 748~
From my experience the mortgage late's have more of a drastic impact as they drastically lower your credit score. Lenders are more apt to look over a short sale in the past if credit scores are 748 because of no mortgage lates other then 550 with mortgage late's despite both scenarios having a short sale.
Good Morning Maria, thanks for sharing the link, good information for home owners in trouble.
This is a very good article; however, so much depends on the lender, which can vary widely. I know of a person with a foreclosure that oly impacted their their FICO score by about 10o points.
Good Morning Maria
Thanks for the post and information. Have a great day.
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