How To Arrange A Short Sale
In many parts of the country and even in our own area, foreclosures have been on the rise. In the past year, nationwide, there's been nearly a 75 percent increase in the number of foreclosed homes - bringing the total number of foreclosures to over 2 million in 2007 alone. Lately, however, the phenomenon of short sales is bringing up questions about consumer credit, credit scores and how they will be affected.
What Is A Short Sale?
When the equity in the property will not cover the debt owed and the cost of selling it, a lender may agree to accept a lesser amount for the home than is owed. Usually, a lender will only consider taking less than what is owed if the home owner is in arrears on payments. Even then, not all lenders will agree to a short sale.
Short sales are not always the solution to avoiding dings on your credit. A short sale will still result in a lower credit score. Usually, in a foreclosure, the credit score is lowered 250-280 points. In a short sale, the score may only be lowered 80-100 points and the seller may be able to purchase another home with good interest rates within 18 months.
In comparison, it typically takes 36 months to repair your credit after a foreclosure.
Is A Short Sale For Me?
If you're facing foreclosure in Western Washington State, talk to us about the possibility of a short sale. It is best to seek advice to see if this is a viable option for you. Richardson Realty Group are experienced in this area of real estate, and can help you through this process.