Short Sale vs Foreclosure – Why Bother??
In these difficult times, it can feel like there are nothing but bad choices. However, some are not as bad as others. If you are finding yourself having difficulty with keeping up with your payments you do have some choices.
Short Sale: Even if you are behind on your payments or don’t think you can sell your home for as much as you owe, we may still be able to help you sell our home and get out from under your loans. A short sale is when you sell your home for less than the total amount you owe the lender(s). The process can be arduous but you avoid a foreclosure and generally will face less negative consequences on your credit score. We have successfully negotiated over 30 short sales and usually gotten the lenders to forgive the shortfall on the payoffs.
We will help you through every step of the process. The lenders generally require a couple years of tax returns, bank statements, and a letter explaining why the loan cannot be paid in full (a hardship letter).
Foreclosure: Foreclosure is when the bank actually goes through the process with the public trustee to sell a property at auction. The process starts when the Public Trustee sends a Notice of Election and Demand. From that point it can be as little as 120 days before the property is sold at auction. Frequently the bank ends up with the property. Even if the process has started, you may still be able to sell your home – if we can get an offer, most lenders will pause (forestall) the foreclosure proceedings, giving more time to complete the sale.
Foreclosure can a have significant effect on your credit score, ability to obtain loans, and even security clearances.
For example:
–foreclosure will lower your credit score 250 to 300 points for 3 years while a short sale might only drop your score 50 points for 12 to 18 months (because of late payments),
–foreclosure will make a potential homeowner ineligible for some loans for 5 years while the short sale may only affect eligibility for 2 years.
Contact us today for more information! Email: info@bernardirealestate.com / Phone: 303-402-6000 / Website: www.bernardirealestate.com
