We hear this alot, and you need to know the choices.
The choices will reflect differently on your Credit Scores. If you do a short sale but you stay current on your mortgage, your FICO scores will get a hit of 30 points ONLY. If you are deliquent on your mortgage and you do a Short Sale, your FICO scores will get hit on a range from 100 to 200 points depending on the severity of your delinquencies.
If you decide to do a Foreclosure and walk away from your home and mortgage and you have 7 payments behind in your mortgage, it will be an automatic 250 FICO points drop. If the bank takes its time foreclosing on your property and you are not making your payments, your scores continue to drop every month further.
The best for saving your credit is a Short Sale and making some or all of your payments. The better you retain your FICO scores the quicker you will be able to purchase another. Its not hard to recoup 100 FICO scores; but it will take you forever to get 250 or more points and with a Foreclosure you may not be able to buy again for close to 7-10 years. With a short sale, you can buy again in 2 years
Although not many lenders allow it, a buyer with a recent short sale but zero mortgage lates during the short sale may purchase a new home with FHA mortgage financing without the normal 2+ year waiting period.
www.MarleneDietrichNewportCoastRealtor.com
Marlene Dietrich, Tony & Mike
Comments(2)