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WHAT WILL YOU CHOOSE "foreclosure or Short Sale" .......?

house on sale

Short Sales are a mystery to most consumers because there is some confusion about the impact they have on their credit assessments/credit scores. It has been confirmed by fair Isaac (who is inventor of FICO credit rating system) that a short sale to be a big derogatory item because of it being listed as a settled account. Any derogatory incidents may have a serious negative impact on your credit rating.

Now what is the different between short sale and foreclosure?

Communication is the main difference between short sale & foreclosure. It has been seen that, in case of foreclosure process there is no communication between home owner & the bank. But there is a communication between the bank/lender and the home owner. In between homeowner/the home owner's representative can have negotiation with the bank/lender. Besides negotiating a reduction in the loan fee, they could also be to negotiate what the lender with the three credit bureaus once the transaction is closed.


The short sale will be taken as major derogatory indent depending upon the lender reports, if it is settled/ settled for less than the full amount. But if the lender does not report on the same, then short sale will not give any negative impact.
During this period (short sales process) the homeowner can choose to remain current on loan. If they are still in progress, they will not have the added value of the negative impact of late payments which can affect on their scores.
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