If your financial problems have reached the point where you do not see a way out and you feel as though you are drowning in debt, your best way out is through declaring bankruptcy. Filing may well allow you to get your finances back on track
Thankfully, there are now several web sites that are there to help people like you with bad credit to find the fast personal loans that you need. When you have bad credit, the first thing that you should be looking for is a loan company that
Financial setbacks that affect a persons ability to pay their
mortgage are heartwrenching, especially for homeowners with good credit who
have always paid their bills on time. Its
very easy to get discouraged and want to give up when you fall behind on your
mortgage payments. Ive heard many homeowners
say, Ive already ruined my credit, it cant get any worse. Unfortunately, it can get worse, because the
nightmare does not end when the bank forecloses on your property.
The
consequences of letting the bank foreclose are more severe than the
consequences of selling your property via short sale. Lets look at the advantages of each option:
Advantages of Letting the Bank Foreclose
- You dont
have to do anything. This alternative does
not require you to take any action.
Advantages of Selling Via Short Sale
- Results in
less damage to your credit both short term and long term
- Reduces
the chances your lender will pursue you for a deficiency judgment
- Allows you
to purchase another property sooner
If your question is whether a short sale and the missed
mortgage payments that normally precede it will hurt your credit score, the answer
is yes. However, the credit damage done
by a short sale does not last as long nor is the impact as severe as a property
foreclosure. Foreclosures can remain on your
credit report in the public records section for 10 years and your FICO score
will generally drop further if you are foreclosed on than if you do a short
sale. So, before you give up on a short
sale attempt, think about all the things you hope to accomplish over the next
10 years.
If you work out a resolution like a short sale with the bank prior
to foreclosure, your lender is less likely to pursue a deficiency judgment
against you in court. Mortgage lenders
rarely pursue deficiency judgments against borrowers and they are less likely
to do so after a homeowner by pursing a short sale has spared the lender the additional
legal fees associated with foreclosing on a property. Theres no guarantee, but working out a
resolution like a loan modification or a short sale reduces the likelihood that
your lender will stalk you after the sale of your property.
In most cases, you can purchase another property much sooner
when you do a short sale than you can when you are foreclosed on. Seasoning is mortgage industry lingo for the
time period that must elapse before a borrower is eligible for a loan. Short sale seasoning under Fannie Mae
guidelines is only two years whereas it is five years for foreclosures. By pursuing a short sale rather than
resigning yourself to a foreclosure, you can reasonably expect to buy another
property many years sooner.If you own a property and miss mortgage payments, obviously, the choice is yours. Doing nothing may seen easier than taking action--at least in the short run. Unfortunately, by doing nothing, you give the bank no choice but to foreclose and in most cases you make things worse for yourself. No matter how bad things get, we owe it to ourselves and our families to do what's the best for us and for them. Although none of the alternatives you have when you fall behind on your mortgage are ideal, some choices are clearly better than others. You will feel better if you exert some control over your own fate and do what you think will be best in the long run.
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