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Short sale and foreclosure

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Frederick
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Subject: Short sale and foreclosure
 
 Posted on Fri Jul 04, 2008 11:51 am  
Can anybody tell me what is the major difference between short sale and a foreclosure. I want some information on it.
Justin

Justin

Joined: 17 Jul 2006
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28942 Magic Points
 
 Posted on Fri Jul 04, 2008 12:19 pm  
Short sale and foreclosures both relate to your inability to repay your mortgage payments. In case of short sale, you sell your home at much lower price than what you owe to the to the creditor. On the other hand in foreclosure, lender not only takes your house, but can also put judgment against you.
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Justin
Mary

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17396 Magic Points
 
 Posted on Sat Jul 05, 2008 7:09 am  
Yeah, but both foreclosure and short sale gives negative impact on your credit report. While short sale lowers your credit score by over 200 points, foreclosure lowers it by about 240 to 260 points. Although both are negatives in your credit report, it is always advisable to go for shortsale. But the main problem with short sale is that, it is very difficult to make your lender agree to sort sale.
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goodnatured



Joined: 03 Nov 2007
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10 Magic Points
 
 Posted on Sat Jul 05, 2008 11:52 am  
If you go to the top of this page, you will see a mortgage tab, if you go there, and post your question you will get a lot of good responses and advise from people who are working in the mortgage and banking industry.
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cdloanmod



Joined: 26 Jan 2009
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Location: Laguna Hills,CA


792 Magic Points
Subject: RE : Foreclosure
 
 Posted on Thu May 28, 2009 7:52 am  
Hi,

Around 30% of the properties in foreclosure were reported as non-owner occupied. This means that the renters were probably displaced in the process, regardless of whether or not they paid on time.
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rachael



Joined: 11 May 2009
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Posts: 234



6581 Magic Points
 
 Posted on Fri May 29, 2009 5:34 am  
Hi Frederick,

In recent times the percentage of short sales has risen a great deal, because of the increasing number of debtors defaulting on loans. In case of a short sale, it is easier for both parties, the creditor and the debtor, to resolve the issue. The creditor is repaid, without going into the lengthy procedure of foreclosure and the debtor can sell off his house, at a much lesser price than he owes.

But the problem is, which Carol mentions, that creditors often do not agree to short sale. It very obvious, because they get back less than the loan amount. This can be overcome if you are able to negotiate with your creditor. You should be able to give some valid reasons for your financial crisis, that led to missed payments. In that case, it is possible that the creditor will agree to short sale.
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