The thing is that credit bureaus may view your inability to pay – either by short selling or foreclosure – with the same perspective. Each case is different depending on the borrower and the situation.
Tampa, FL (PRWEB UK) 4 May 2013
Tampa realtor Nathan Bangs reveals in a recent interview how homeowners’ credit scores can be affected by short sales.
“A short sale means selling a home for less than what is owed on the mortgage. This process can avoid foreclosure and allow homeowners to escape from a loan that they can’t manage anymore,” said Nathan Bangs.
“But it does affect the seller’s credit and his or her ability to buy property in the future,” he continued.
When asked how it can affect the seller’s credit, Bangs replied:
“We keep hearing from homeowners that one of their main reasons for choosing a short sale instead of a foreclosure is their perception of a reduced impact on their credit score.”
“Some real estate experts are convinced that a short sale would have less impact on a credit score than a foreclosure. This is because the short sale would not be listed as a foreclosure on a credit report—it will only be listed as a previous delinquency on a mortgage. These experts also say that many mortgage lenders report to credit bureaus that the mortgage paid through a short sale is one that is in redemption status,” he continued.
When asked for his own opinion on the matter, Bangs answered:
“The thing is that credit bureaus may view your inability to pay – either by short selling or foreclosure – with the same perspective. Each case is different depending on the borrower and the situation. Factors that affect their view include bankruptcy, deed-in-lieu, short sale, judgments, charge-offs, etcetera. These things are taken into account regardless of the person’s credit score.”
“However, all things being equal, short sales do affect your credit score less than foreclosures. To government agencies, a short sale will allow you to buy another home in two years versus the five-to-seven-year waiting period required when you choose foreclosure,” he continued.
Tampa residents looking for expert short sales assistance can contact Nathan Bangs at http://www.nathanbangs.com.