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A short sale will effect your credit score in a negative way. Your credit score will stay on your credit report for some years.

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โˆ™ 2014-08-27 20:33:07
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Q: How will a short sale effect your credit score?
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Related questions

Do forbearance payment affect credit score?

Do forbearance payment affect credit score? Also, if your lenders agree to a short sale and you have not been deliquent on your payments but the lender granted you a forbearance, will your credit score be affected?


Is a short sale better than foreclosure?

In most cases it is preferable to foreclosure. I disagree. A short Sale has less impact on your credit score than a foreclosure.


What does your credit score need to be to get a home loan?

There is no set credit score. It depends on the bank and your credit history. Some banks do not allow you to get a loan within 2 years of a short sale. Thanks for using answers.com!


Does a short sale affect credit score?

A short sale takes place when a lender accepts less than they are owned on a loan secured by a property in the US. In most cases the borrower was already in default on the loan prior to the agreed short sale. The lender will have already reported the late payments or default and there likely was credit damage. The short sale can be recorded as paid as agreed or various other language. A short sale might show as a negative. Or it will show as the loan being paid off after a number of late payments so the credit file shows an account going bad and then no further activity on that account. A short sale is much better than a foreclosure or bankruptcy filing on one's credit report. Late payments are normally the only real sign of a short sale and late payments have an impact for approximately 12 months before a credit score starts to improve. When dealing with your credit report check it yearly and challenge all items that are not accurate.


What happens to your credit on a short sale?

A short sale will have a detrimental affect on your credit record but not as bad as a foreclosure.


How do you repair credit after a short sale?

Your credit score relies most heavily on the most recent 12 months of activity. Therefore, the best strategy will be to continue using credit responsibly and demonstrate a history of credit worthiness.


Is it better to short sale a house or refinance to get credit in good standing?

It's better to refinance. A short sale will reflect negatively on your credit record.It's better to refinance. A short sale will reflect negatively on your credit record.It's better to refinance. A short sale will reflect negatively on your credit record.It's better to refinance. A short sale will reflect negatively on your credit record.


How long will you credit be messed up if you are doing short sale?

A short sale is an option when a property owner is not able to afford the obligations of a loan. The amount of time a short sale is on a credit report can be answered by a lawyer who is assisting in the short sale. A short sale may hinder future loans.


If i short sale a house how long do i have to wait to purchase a dwelling?

If you short sale a house you don't have to wait any specific amount of time to purchase a dwelling. It does mean that the interest rate on the new mortgage could be higher than normal, or it may be more difficult to purchase a new dwelling due to the poor credit score resulting from the previous short sale.


What is better a short sale or a foreclosure?

A short sale is always better. I will tell you why very definitively. When you purchase a home on a short sale you are helping a homeowner salvage their credit and dignity and helping them out of a bad situation. You are also preventing a large loss for the bank and getting a great deal for yourself. Everyone wins if it is done correctly. A foreclosure will have a very bad effect on a homeowner's credit and the bank will in most cases take a bigger loss than they would in a short sale. A sellers credit in a short sale will be damaged to a lesser extent than a foreclosure. In most circumstances if you have done a short sale you will not be able to get another loan for two to three years. In a foreclosure it is usually around five years before you can purchase another home.


Foreclosure vs short sale?

Ultimately the impact of a foreclosure to your credit rating and ability to borrow in the future is reason to choose the short sale over the foreclosure. Lenders will look more favorably upon a potential borrower that tried to work with the bank (via short sale) opposed to one who just walked away. The short sale process, when handled properly, can even result in a favorable narrative on your credit report, which will minimize the impact to your score. When looking for a short sale specialist, I suggest you make sure that agent has a trained mitigator that will negotiate with the bank on your behalf. Also, the agent you choose should have experience in the short sale market. Hope this helps! If you need more information or have other questions, just ask.


How long does a short sale stay on your credit?

10years...


Will it affect my credit if I short-sale a house that I own but do not have my name on the mortgage?

To conduct a short-sale transaction, the bank(s) holding the mortgage(s) have to agree to a short-sale. If your name is not on the Mortgage, technically you don't have a right to conduct a short sale. Even if you "own" the house (which will be in question during the entire process), the holders of the Mortgage note(s), typically banks or finance companies, actually have primary ownership of the asset (the house). If you are able to complete a short-sale, even though you are not on the mortgage note, as an owner the bank holding the note may ask you to take partial responsibility for the difference between sale price and mortgage value, or even to put in equity immediately to avoid a short sale situation. If this occurs, and you cannot pay, you will end up with a debt and a schedule to pay that debt. Adding any debt will negatively affect your credit score.


Can you get a boat loan after you short sold your house?

I've tried two places so far, Southeast Financial and First Premier. Both have denied my claim. It's been two years since I was forced into a short sale by the bank on a secondary property. I have a 675 credit score and haven't missed a payment other than the short sale in 20 years. Not sure if I'll ever get a loan...


How to get foreclosure off your record?

Foreclosure is simply on your credit report like any other damaging hit to your credit, for up to seven years. You can remove it from your credit report, you can only attempt to build up your credit in the meantime. The most effective way to build up your credit is to have a line of credit that is active, and in good standing. An example of this a credit card that you use to buy your gas on every week and pay in full every month. The affect of a short sale on a home owner's credit report is much less damaging. The negative on credit may show up as a pre-foreclosure in redemption status, which will result in a loss of around 80 points from the FICO score. It can also simply show up as the loan was paid off and not affect your score at all. This means a short sale with a previous FICO of 680 could possibly see it fall to around 600 or it could remain the same.


What is short sale?

A short sale is when the bank or lender allows the homeowner to sell their property for less then is owed to them. With over 15 million homeowners in default, a short sale is one of several alternatives to avoid foreclosure. It effects your credit score much less then a foreclosure, damages your credit a significantly lower amount of time, and can often result in no deficiency statements. In order to facilitate the short sale transaction a qualified real estate agent should be contacted. They are paid from the bank and should not charge you a dollar. Be careful of pricey transaction coordinators, attorneys, and bankruptcy agents after your money with little care of your actual financial situation. After careful analysis of your options it is important to make an informed decision. After considering all my options I was able to succesfull perform a short sale with a qualified agent.


Can you buy home after short sale?

Yes you can buy a home after shortsale, remember your credit with be ok for the simple fact it will show you paid your debt of your home by doing a short sale.


How does short sell affect credit?

It all depends on how late or how many payments you were late when you start the short sale. In most cases if you get a successful short and your home gets sold it is a lot better than having a foreclosure on your credit report.


How long does a short sale affect your credit?

Iam bout to lose my house soon, getting divorce!. is it recommended to do a short sale? I am concerned about 1099-C taxes I have to pay to IRS and how bad my credit will be if I want to get a cheaper property later on. does enybody know how much afeccts short sales, is it better than a foreclosure! Thanks


Does a mortgage loan help your credit score?

Typically speaking, yes. A mortgage loan acts as an installment loan, which if you pay on time on a regular basis, and your balance goes down each month, it can certainly help your credit. That being said, just one or two MISSED mortgage payment can have a huge negative impact on your credit score. 30% of your credit score is determined by your payment histories and a huge chunk of that 30% is your mortgage payment. If you are talking about a REFINANCE mortgage with which you consolidate debt, that can have a huge positive impact on your score because your revolving account balances drop to zero. High balances on revolving accounts (like credit cards) have a large negative impact on your score. You never want to carry a balance on a credit card that is more than 50% of the credit limit. While it's true that refinancing can help you consolidate high-APR credit card debt, and reduce the associated balances, a refinance will likely lower your credit score in the short term. Also, you are exchanging unsecured debt with secured. If you cannot make the payments, you are facing foreclosure or a short sale. This happened to many folks during the 2008 subprime downturn, so be very careful. Essentially, any time you apply for new credit, you appear as a higher credit risk to other lenders, so your credit score will drop as a result. But long-term you'll improve your financial position if you make timely payments on any new loans.


Is it possible to avoid short sale's negative impact on credit record by continuing short amount payments to lender?

No. The short sale and the credit situation that made it necessary will stay on your credit report for 7 years or the applicable statute of limitations. The debt is extinguished by the short sale, if properly executed, so you would not be entitled to mortgage interest deductions on your tax returns. You would be making gifts to the mortgage company and decreasing your ability to pay other debts. Get some good debt counselling, from a US Trustee-approved debt counseling agency or experienced attorney.


What is the best way to get your credit back after foreclosure?

The best way to rebuild credit after a serious blow is to have an open and active line of credit that is in good standing. For instance, a credit card that you use to purchase gas on every week and then pay off in full every month. Over time, your credit score will improve based on your performance with that line of credit. If you allow your home to be foreclosed or if you sign a Deed-in-Lieu of Foreclosure. Home owners will take a hit of about 250 points on their FICO score. This means if a their FICO score before foreclosure was 680, it could dip as low as 430. A home owner who wants to buy another home after foreclosure will end up waiting about 24 months before a lender will offer any kind of interest rate that makes sense. During that time you must have a near perfect credit. The affect of a short sale on a home owner's credit report is much less damaging. The negative on credit may show up as a pre-foreclosure in redemption status, which will result in a loss of around 80 points from the FICO score. It can also simply show up as the loan was paid off and not affect your score at all. This means a short sale with a previous FICO of 680 could possibly see it fall to around 600 or it could remain the same. There are actually companies that will work with you for free to buy your mortgage away from your mortgage company and avoid your foreclosure. I would advise looking into this first.


What is a short sale?

A short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan. It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower. Both parties consent to the short sale process, because it allows them to avoid foreclosure, which involves hefty fees for the bank and poorer credit report outcomes for the borrowers.


Can you get a home loan after having a foreclosure?

That depends on your starting credit score. If you allow your home to be foreclosed or if you sign a Deed-in-Lieu of Foreclosure. Home owners will take a hit of about 250 points on their FICO score. This means if a their FICO score before foreclosure was 680, it could dip as low as 430. A home owner who wants to buy another home after foreclosure will end up waiting about 24 months before a lender will offer any kind of interest rate that makes sense. During that time you must have a near perfect credit. The affect of a short sale on a home owner's credit report is much less damaging. The negative on credit may show up as a pre-foreclosure in redemption status, which will result in a loss of around 80 points from the FICO score. It can also simply show up as the loan was paid off and not affect your score at all. This means a short sale with a previous FICO of 680 could possibly see it fall to around 600 or it could remain the same. There are actually companies that will work with you for free to buy your mortgage away from your mortgage company and avoid your foreclosure. I would advise looking into this first.


How do you get your credit up after a foreclosure?

The best way to improve your credit after a major hit to your score is to have a line of credit that is active and in good standing. An example of this is a credit card that you use to buy gas on every week and then pay off in full every month. If you allow your home to be foreclosed or if you sign a Deed-in-Lieu of Foreclosure. Home owners will take a hit of about 250 points on their FICO score. This means if a their FICO score before foreclosure was 680, it could dip as low as 430. A home owner who wants to buy another home after foreclosure will end up waiting about 24 months before a lender will offer any kind of interest rate that makes sense. During that time you must have a near perfect credit. The affect of a short sale on a home owner's credit report is much less damaging. The negative on credit may show up as a pre-foreclosure in redemption status, which will result in a loss of around 80 points from the FICO score. It can also simply show up as the loan was paid off and not affect your score at all. This means a short sale with a previous FICO of 680 could possibly see it fall to around 600 or it could remain the same. There are actually companies that will work with you for free to buy your mortgage away from your mortgage company and avoid your foreclosure. I would advise looking into this first. Try http://www.speedyrealestate.info. Good luck!