A short sale transaction occurs when mortgage lenders allow the borrower to sell the house for less than the amount owed on the mortgage. The foreclosure process occurs when lenders repossess the house, often against an owner’s will. Furthermore, a short sale is far less damaging to your credit score than foreclosure.
Does a short sale hurt your credit?
The term “short sale” does not appear in a credit report. When you negotiate a short sale, the lender is agreeing to accept less than the full amount owed on the mortgage, and will likely report the account as settled for less than the full balance. With time, the negative impact on your credit scores will decrease.
What happens if you have a short sale on a house?
If you see a home languishing on the market month after month as a short sale, it’s usually not the lender holding up the sale. The buyer might have canceled so the entire process started over. Unfortunately, you can’t always avoid problems on a short sale.
Can you sell your condo on the market?
Sell your condominium yourself if you’re in a fair market position. A good way to save on real estate costs is to sell your condo yourself. If your sale is a “fair market” transaction, meaning you’ll be selling it for more than your mortgage, you can legally do the sale yourself.
Is the real estate market flooded with short sales?
Many U.S. real estate markets are flooded with short sales and, according to the National Association of Realtors, that number is only expected to increase in the near future. So if you’re in the market for a new home, there’s a good possibility that you’ll fall in love with a home that’s listed as a short sale.
Is the short sale process intimidating for sellers?
The short sale process can seem intimidating, yet getting a handle on the steps can make it a lot less scary—and help home sellers navigate a difficult financial situation without too much damage.
