Short Sale Expert Advice

Short Sale Expert Advice

Short Sale of your home is one of the options available to Avoid Foreclosure for home owner who owe more on their mortgage than their home mortgage.  But the impact on credit is much less severe than a Foreclosure for sure.  In fact, since some banks are reporting the loan as “Closed” or “Satisfied”, there should be minimal impact on your credit.   Also, since Short Sales are now being approved in days as opposed to months, the impact of Missed Payments are minimized since the home owner could be missing 1 or 2 payments before the Short Sale is concluded.  

In fact, if you participate in a HAFA Short Sale, your loan will be reported a “Paid in Full” according go to latest HAFA guidelines.  Some banks are exploring pre-approvals to owners ONE day after a successful Short Sale!   So, Short Sale of your home does NOT mean an end to your ability to purchase another home .   In fact, some home owners are strategically removing the bad Loans from their credit using Short Sale knowing full well that the odds of their underwater home recovering it’s full value are slim.  And with Cash incentives for Short Sale offered by Chase, Bank of America, Wells Fargo the opportunity to ditch your bad loan. Another justification to consider a Short Sale in 2013 might be the fact that you will now owe taxes on the forgiven debt specially since there is no grantee that Congress or State of California will extend the tax relief act in 2014.

Alternatively, if your San Jose home is foreclosed the impact on your credit history will be severe and will last for at least 7 years.  With a Foreclosure on your record, your credit card companies will also increase your interest rate to the maximum possible allowed by law.  You will also have a tough time establishing new credit right after a foreclosure.

Given the popularity of Short Sales most lenders are now offering homeowners relocation assistance to expedite the the short sale listing, which means they will sometimes pay you to move.  Contrast that with the harsh reality of a foreclosure process where you will be given a 2 week notice to move out.   Short Sales Listing is a much more humane and elegant way to exist a difficult financial situation while minimizing the damage to your credit history.   Don’t expect that kind of treatment with a foreclosure proceeding.  

To see if you San Jose home qualifies for a Short Sale and any Short Sale Cash, Contact Us and get a Free Home Value Report.

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