By startingpoint March 11, 2014

With the average foreclosure proceeding costing a lender $58,000, it is usually also in THEIR best interests to cut their losses and accept a short sale. Don’t trust your financial future and the short sale of your property to just ANY one. Experience is everything when it comes to short sales, even Realtor® designations and weekend training classes are insufficient. Compared to the standard closing rate of 20%, Starting Point Home Solutions has a industry-leading successful closing rate of 90%.

IssueShort SaleForeclosure
Credit ScoreA short sale itself will minimally affect your credit score, usually around 50 points. Late payments usually have the largest negative impact on your credit score.Your credit score could be lowered 300+ points and will stay on your record for 10 years!
Credit HistoryThere is not a credit reporting item for a short sale. Upon sale, your mortgage company will typically report the short sale as ‘Paid’, ‘Settled in full’, or ‘Paid as Negotiated’ on your report.A foreclosure will remain on your credit for 10 years and is permanent in the public records of your county.
Current EmploymentA short sale is not an actual item on your credit report and typically will NOT affect your employment.Your employer has the right and many times will actively check your credit if you are in sensitive positions. Sometimes a foreclosure is grounds for immediate re-assignment or termination.
Future EmploymentA short sale is not an actual item on your credit report and typically will NOT affect your employment.Your employer has the right and many times will actively check your credit if you are in sensitive positions. Sometimes a foreclosure is grounds for immediate re-assignment or termination.
Future Home Loan – Primary ResidenceAfter a successful short sale you may be eligible for a Fannie Mae backed loan after only 2 years.After a foreclosure you will be ineligible for a Fannie Mae backed loan for a minimum of 5 years.
Future Fannie Mae Loan – Non-PrimaryAfter a successful short sale you may be eligible for a Fannie Mae backed loan after only 2 years on non-primary residences.After a foreclosure you will be ineligible for a Fannie Mae backed investment loan for a minimum of 7 years.
Deficiency JudgmentSPHS negotiate with the lender to give up the right to pursue a deficiency judgment against the borrower. This is stated in approval letters.The bank has the right to pursue the deficiency judgment in all foreclosures.
Deficiency AmountA short sale home is sold at or near market value and in most cases is a greater value than a foreclosure sale which results in a lower deficiency. This deficiency is typically forgiven.If the home does not sale at a foreclosure auction it will have to go through the bank REO system. This will result in a longer sell time and potentially a higher deficiency judgment for the homeowner.