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John M
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 Posted: Fri Nov 20, 2009 4:50 pm Post subject: short sale versus foreclosure |
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I am getting mixed advice. Some say short sale is best for it doesn't hit hte credit score as hard etc but others say 'just foreclose' because in a short sale you sign to still pay the lenders loss and in a foreclosure it is just done.
Also, in s hort sale can they get every bit of savings you have to pay the difference. We will need that to get back on our feet after a job loss.
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 unclebuck48
Joined: 09 Sep 2009
Posts: 27
9.06 Dollars($)
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| Posted: Fri Nov 20, 2009 8:13 pm Post subject: |
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| Check your state laws on "deficiency judgments", some states will not allow the lender to go after you for the deficiency, (difference between what the house sells for and what you owe on it.) If you foreclose the lender can go after you for the deficiency, if your state allows. Keep in mind, most lenders don't pursue deficiency judgments, if they do, they will have to sue you for it. |
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smithsussane
Joined: 18 Sep 2008
Posts: 4546
Location: Alaska
445.32 Dollars($)
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| Posted: Fri Nov 20, 2009 8:42 pm Post subject: |
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Hi John M!
Welcome to forums!
A short sale will reduce your credit score by 75-100 points whereas a foreclosure will reduce it by 250 points. In both the cases, you would be responsible for paying off the deficient amount resulting from the sale. If you are concerned about your credit score, then a short sale is a better option for you.
As far as the deficient amount is concerned, you will have to negotiate with the lender so that he reduces the amount or gives you an affordable payment plan to pay off the loan.
Feel free to ask if you've further queries.
Sussane |
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