Foreclosure vs short sale?
Ultimately the impact of a foreclosure to your credit rating and
ability to borrow in the future is reason to choose the short sale
over the foreclosure. Lenders will look more favorably upon a
potential borrower that tried to work with the bank (via short
sale) opposed to one who just walked away.
The short sale process, when handled properly, can even result
in a favorable narrative on your credit report, which will minimize
the impact to your score. When looking for a short sale specialist,
I suggest you make sure that agent has a trained mitigator that
will negotiate with the bank on your behalf. Also, the agent you
choose should have experience in the short sale market.
Hope this helps! If you need more information or have other
questions, just ask.
Related Q&A：
How does the bank make up for short sale deficiency？Well, you know, banks have a few ways to deal with short sale deficiencies. Usually, they might try to recoup the losses by going after the borrower for the remaining balance. They could also sell the debt to a collection agency. Another option could be to take a hit on their books and adjust their financial statements accordingly. Oh, and sometimes they might even look at the borrower's other assets to try and recover the money. It's not a simple process and can be quite a headache for both the bank and the borrower.
