Credit Effects of a Short Sale
October 14, 2009 by admin
Filed under Blog, Credit Affects of a Short Sale
Will A Short Sale Affect My Credit?
Your credit will not be affected as poorly as a foreclosure on your credit report. There is generally a 50-80 point hit on your credit score, which appears as “debt settled”. On the opposite end, a foreclosure will take 5-7 years to restore your credit to what it once was before the foreclosure.
The affects of a Foreclosure or Deed-In-Lieu of Foreclosure
We are seeing an average hit of about 200-280 points on your credit score. According to debtkid.com “A pre-foreclosure FICO fo 675 could drop to as low as 395, essentially eliminating you from future credit approvals. ” We are seeing that it is taking about 5 years to apply for a new loan.
Consulting with a CPA
It is always a great idea to consult with a tax accountant regarding the tax ramifications of a short sale. One may be charged for a consultation, but it is worth the knowledge of knowing where your credit will stand after a short sale. It is important for homeowners to get the proper help that they need. Make sure to work with people who have a strong understanding of short sales.
KS on Tue, 3rd Aug 2010 1:19 pm
The website has very useful info on Short sale and Foreclosures. Thank you.
Just one thing, whoever wrote the articles seems to have mixed up the meaning of “effect” and “affect”. It’s not “affects” of a foreclosure, it is “effects” of a foreclosure.
Please have this corrected.
Regards