The term â€œshort saleâ€ is used to describe an agreement between you and your lender to sell the house for less than is owed on the mortgage. The term does not appear in a credit report.
Instead, the mortgage account may be reported as â€œsettled,â€ or â€œsettled for less than originally agreed.â€ It also will show the history of missed payments. Any account not shown as paid in full as originally agreed is considered negative. A mortgage debt not paid in full can have a substantial negative impact on credit scores.
Time is the key for rehabilitating your credit history. Make sure all of your other debt payments are always made on time, and reduce any debts you have as much as possible. Continue to use your credit cards, keeping your balances low and paying in full each month. That positive, current activity will help to somewhat offset the negative history for your mortgage.
However, the mortgage history wonâ€™t go away. The late mortgage payments will remain for seven years from the date they first became late. The further in the past the late payments occurred, the less impact they will have on credit scores. As the delinquencies become further in the past, your credit scores should improve, assuming you have kept all of your other payments current.
Still considering a short sale as an option?
Give me a call.Â I have a team of experts that can help you navigate the maze of paperwork and
deadlines for you.Â In most cases the Lenders agree to pay our fees.
We don't judge you.Â You made a difficult decision based on what is best for you and your family.
We are here to help you move on.