A short sale is a great way to sell your home and avoid the credit consequences of foreclosure. A short sale is basically the negotiation with the lien holder for a payment of less then you owe. If you’re on the brink of having your home foreclosed on it’s a good idea to start negotiations with your lender right away. Short sales are faster and less expensive than foreclosures. Foreclosure is not something you want to passively allow to occur, its detrimental to your life and should be avoided at all costs. A foreclosure will completely ruin your credit, lowering your score as much as 300 points! This is very difficult to recover from and in most cases takes years to bring your credit score back up. For the time after a foreclosure you will not be eligible for any types of credit such as loans, mortgage, credit cards, or even employment. Many employers check the credit of applicants (especially if the position involves handling of money) and poor credit history may not qualify you for the position.

A short sale is a great alternative to foreclosure but definitely should not be considered a good thing. Short sales will lower your credit score, Although much less than a foreclosure will. Homeowners should only consider going through with a short sale when foreclosure is eminent otherwise. The lenders will typically approve a short sale if they are losing less money out of the deal then if they foreclosed on your home. It’s important to understand that your lender is looking out for the companies best interest when negotiating a deal rather than yours. A short sale is a long complicated process that is difficult for individuals to negotiate without professional help. Most people who need a short sale are usually “upside down” on their loan. This means they owe the bank more money than they can sell their house for. The whole purpose of a short sale is to get your lender to allow you to quickly sell your home for less than it’s worth to prevent foreclosure. Your lender will receive all the proceeds from the sale.

If you are considering selling your home through a short sale the next important step is choosing a reputable company to negotiate on your behalf. When dealing with something as serious as negotiating a short sale with your lender it’s almost a must that you let an experienced attorney work on your behalf. The mortgage companies have attorneys working for them and so should you. You absolutely need an individual with extensive knowledge of the law to negotiate ideal terms for you the homeowner. There are many services out there that claim they can help you out, but if they don’t have attorneys on their staff its very unlikely they can negotiate the very best terms for you. A short sale is a maze of legal proceedings and documents that usually last about 6 months and when dealing with something as serious as your home its best to rely on the best organization you can. For starters you can check a company’s BBB (better business bureau) record for any complaints and see how long that company has been established.