The credit consequences of a short sale and the credit consequences of a foreclosure vary slightly. The general consensus is that a short sale will show up on your credit report as a “settled”, “settlement for less than owed” or a “pre-foreclosure”. Also, since some lenders will not consider allowing a short sale until a few payments have actually been missed you may also have a few “lates” on your credit report. Neither of these marks is a good thing to have but it’s possible to get them off of your credit report within a few years or less. Now we have asked many credit experts and in general, a short sale can drop your credit score by 100-200 points. Most experts vary on the amount it will affect your credit, but it really does not matter. Expect that your credit will be affected during this process and after we complete your Arizona Short Sale, hiring a credit repair company right away is highly recommended. There is also the possibility that through negotiation with the lender you can avoid having the short sale reported to a credit agency.

Posted on Phoenix Homes For Sale | Phoenix Real Estate | Morrison Residential LLC