The Secret to Keeping Your Good Credit While Performing a Short Sale

Mortgage and Lending with HPM Financial LLC

One of the most common questions I get asked as a credit consultant is; How can a short sale be performed without having to damage your credit? The answer is actually quite simple. Always try to prevent the damage to your report prior to the negative item(s) being placed on your report. One false rumor is that in order to qualify for a short sale you need to be late on your mortgage. I will be happy to explain why this rumor is false in another article, the main thing to understand here is that a short sale is a form of loss mitigation.

You are actually helping to minimize the damage your bank is going to suffer by dealing with this situation head on versus living in the home for 6-12 months with no payment and waiting for a foreclosure. The decision you need to have communicated to your bank is would they rather work with you, or against you.

When my firm is retained to help you keep your good credit intact while preventing damage on your credit report, we always like to start early. It takes much more time to clean up a damaged report, then to keep a clean report from being damaged, Although we have been successful in negotiating with Banks into removing short sale delinquencies after the fact, we like to send a certified letter to the bank that attempts to help our clients form an allegiance with the bank. By showing the benefits and cost savings the bank will receive simply by deciding to work with us instead of against us, we can now decide the best strategy to move forward with.

Although this can be accomplished on your own, this is a very difficult procedure and we recommend you consult with us or any professional company that has documented success in this field. There are a lot of "credit repair and short sale specialists" that have no certification at all in this industry, I don't say this to demean any other company, rather I hate to see anyone losing their money to a less then reputable company.

Using our proven strategies we start an alliance with the loss mitigation department of the bank you are working with, negotiate a settlement ahead of time, and before you know it it is possible to have your home sold for less then you owe on it, and walk away with your credit in tact. If you would like more information about this please feel free to contact me with any questions.


Hayden Gerson is the President of HPM Financial LLC and a Certified Credit Consultant. If you would like to contact him please visit San Diego Credit Restoration,  or call me toll free at (800) 701-5022 ext 101 for a free comprehensive evaluation.

Comments (7)

Brian Schulman
Coldwell Banker Residential Brokerage, Lancaster PA - Lancaster, PA
Lancaster County PA RealEstate Expert 717-951-5552

Good point - starting short sale negotiations BEFORE you become late on payments is probably going to get better cooperation from the lender, as well as helping preserve your credit.

Sep 12, 2009 09:43 AM
Robert L. Brown - Grand Rapids, MI
Grand Rapids Real Estate Bellabay Realty, West Mic

I didn't know that. Good information to know. The hard part is getting the banks TOO cooperate.

Sep 12, 2009 01:22 PM
Tom Boos
Sine & Monaghan Realtors, Real Living - Grosse Pointe Farms, MI
Providing the very best of service to Sellers and

People were unfortunately given the impression by lenders in the past, that they, the homesowner, had to be at least two months past-due in their payment before loss mitigation would entertain the possibility of approving a short sale.  Sadly, some people did do unnecessary harm to their credit standing as a result of following this advice.

Sep 13, 2009 03:17 AM
Christopher Anderson
Avalar San Diego - San Diego, CA

Excellent article.  Most agents don't completely understand the short sale process, and hardly any consumers do.

Sep 15, 2009 04:55 PM
Frances C. Rokicki
Fran Rokicki Realty, LLC - Bolton, CT

Good article!  This should help all of us, get our job done, much easier.  Thank you!  How old is your baby now?

It's a Good Life,


Sep 16, 2009 01:20 AM
Michele Eckart
RE/MAX Advantage Realty - Ellicott City, MD

I have talked to attorneys and we are still being told that the bank will not talk to you unless you are behind.  Also that if you do a short sale it will be 4 to 5 years before you can purchase again.  It appears that every bank is different.

Sep 21, 2009 12:14 PM
Hayden Gerson
HPM Financial LLC - San Diego, CA

Michele: Many attorneys are clueless when it comes to this. Being behind on payments has nothing to do with having a creditor settle with you to not include negative information upon the completion of the short sale. If you have any questions let me know.


Fran: Thanks for the kind words, my baby is almost 15 months old, do you want to see some new pictures?

Sep 22, 2009 06:55 PM