Comparing the Impact of Short Sale and Foreclosure

Comparing the Impact of Short Sale and Foreclosure.

Issue

Short Sale

Foreclosure

Credit Report and Credit History

The term "Short Sale" or "Short Sell" does Not appear on one's credit report.

However, one's account status with the lender does appear, which may impact the homeowner's credit score. After the sale, a lender may report a short sale as:

1. Paid in full - Paid as agreed

2. Paid - Settled

3. Paid - Unrated

4. Paid - Less then owed

How the lender reports the closed account is negotiable.

A foreclosure remains on one's credit history for 7 yrs.

Ability to obtain a loan owned by Fannie Mae

The homeowner is eligible for a new loan in 2 years.

The homeowner is eligible for a new loan in 5 years.

Ability to obtain a FHA loan

No information at this time.

The homeowner is eligible for a new loan in 3 years if the foreclosure was a conventional loan foreclosure.


Information provided by the Real Estate Buyer's Agent Council, Inc of the National Association of Realtors.


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