Short Sale vs Foreclosure what should I do?
Well here is a table explaining the pros and cons
|You can purchase a new home immediately after a short sale||You may have to wait five(5) to seven(7) years before a lender will approve your application for a new home loan|
|Credit reports do not show up as Short Sale||Your credit score will be affected, mainly from being deficient on your loan||Your credit score will be affected much worse than a short sale, also the word foreclosure will show up on your record which for some lenders/jobs is an instant rejection of application|
|The lender may forgive the difference in debt between what you owe and the final price||You may be hit with a deficiency judgement for the remainder of the loan, but this remainder will be much less than a foreclosure||You will MOST LIKELY be hit with a deficiency judgement for the remainder of the loan|
|If primary residence you are exempt from taxes on the deficiency until 2012||It is a long process and it depends on how quickly you put together the right papers, how it is provided and how quickly the lender reacts||If primary residence you are exempt from taxes on the deficiency until 2012|
|You can stay in the house until closing date is finalized.||Same as short sale except most homeowners ignore notices from the bank which then leads to a surprise when they are evicted|