Which is worse foreclosure or short sale?
And if you avoid owing a deficiency with a short sale, your credit scores might not take as big of a hit. But, overall, there isn’t a huge difference between foreclosure and a short sale when it comes to how much your scores will drop.
Do banks prefer short sales or foreclosure?
Banks are businesses and, just like any business, they are seeking to earn a profit. If it costs more to foreclose over agreeing to a short sale, the bank is very likely to favor the short sale. With foreclosure, a bank takes possession of the house, then resells it at a mortgage auction to the highest bidder.
What are the advantages of a short sale?
What are the benefits of a short sale?
- Eliminate your remaining mortgage debt.
- Avoid the negative impact of foreclosure.
- Receive relocation assistance in some cases — up to $3,000.
- Start repairing your credit sooner than if you went through a foreclosure.
Why would a seller do a short sale?
A short sale results when a seller doesn’t receive enough cash from a buyer to pay off their mortgages. The seller could have paid or borrowed too much for the property. The housing market may have dropped, so its fair market value is less than the current mortgage balance.
Do you think short sales are a good alternative to foreclosure Why or why not?
While a short sale is less than a “win-win” situation for you and your lender, you will benefit from not having a foreclosure recorded on your credit report. Assuming you would like to own another home, a short sale will help you become a more attractive borrower in the future.
Why do short sales get denied?
A short sale is sometimes denied due to something as simple as the seller being current on paying their mortgage. The bank’s guidelines might state the bank isn’t allowed to approve a short sale if the mortgage payments aren’t in arrears.
Can a short sale be negotiated?
Can You Negotiate A Short Sale? It is entirely possible to negotiate a short sale, but doing so can be a time-consuming process. Instead of negotiating with the seller alone, as is the case with most traditional sales, short sale negotiations must be approved by the lender, too.