The economic crisis has affected everyone, from all walks of life. One of the most obvious impacts has been in the housing market. Countless Americans are struggling to avoid foreclosure after their mortgage payments ballooned or they found themselves unemployed. If you are one of the unlucky souls whose debt continues to add up daily, you're likely trying to decide what option is best for you. Unfortunately, your decision is likely to come down to two choices - Foreclosure or short sale. As tempting as it may be to pack your things and just walk away, you owe it to yourself to think about your options.
While foreclosure is essentially defaulting on your loan and allowing your lender to take over your home, short sales offer a way for you to try and escape from beneath your mortgage. Your lender must agree to a short sale, but if they do you will be able to sell your property for less than the amount that you currently owe on it. Believe it or not, foreclosure is something your bank wants to avoid almost as much as you do. It can be hard for them to recoup their losses if you default, and they may end up making more from a short sale than they would by taking over your home.
Short sales offer several benefits to homeowners facing foreclosure. While there will still be negative impacts incurred to your credit, they won't be quite as severe. You'll be in control of the sale, and the process is treated just like selling a home is normally treated. If you've never been thirty days behind on your mortgage payment, you can technically still qualify for a new home loan. While it's difficult to find a lender willing to take that risk, you can technically do it. This is absolutely not an option if you end up defaulting on your mortgage. Your credit score will still drop as well, but the damage isn't as severe as it would be in case of defaulting entirely on the mortgage.
While it may seem easier to simply let your home fall into foreclosure, it's never your best option. As stressful as the economic and housing crisis can be, you should always consider your options. Short sales aren't as easy as defaulting, obviously. But they can help you avoid the dread "f word" and make your future a bit more secure.
You owe it to yourself and your family to investigate all your options before just giving up, don't you?
While foreclosure is essentially defaulting on your loan and allowing your lender to take over your home, short sales offer a way for you to try and escape from beneath your mortgage. Your lender must agree to a short sale, but if they do you will be able to sell your property for less than the amount that you currently owe on it. Believe it or not, foreclosure is something your bank wants to avoid almost as much as you do. It can be hard for them to recoup their losses if you default, and they may end up making more from a short sale than they would by taking over your home.
Short sales offer several benefits to homeowners facing foreclosure. While there will still be negative impacts incurred to your credit, they won't be quite as severe. You'll be in control of the sale, and the process is treated just like selling a home is normally treated. If you've never been thirty days behind on your mortgage payment, you can technically still qualify for a new home loan. While it's difficult to find a lender willing to take that risk, you can technically do it. This is absolutely not an option if you end up defaulting on your mortgage. Your credit score will still drop as well, but the damage isn't as severe as it would be in case of defaulting entirely on the mortgage.
While it may seem easier to simply let your home fall into foreclosure, it's never your best option. As stressful as the economic and housing crisis can be, you should always consider your options. Short sales aren't as easy as defaulting, obviously. But they can help you avoid the dread "f word" and make your future a bit more secure.
You owe it to yourself and your family to investigate all your options before just giving up, don't you?
About the Author:
Sean Hinely is a Realtor, Property Manager & Co founder of Property Management Pros.com." To learn more about Short Sales, visit http://www.ColumbusRealEstatePros.com today!
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