Greater Boston Short Sales, LLC
FHA Loan late - 3 years from the date the FHA insurance claim is paid to the lender - not the date of the short sale closing
FHA loan current - NO WAIT - borrower must be current on all obligations, including istallment debt
VA Loan LATE and VA loan CURRENT - 3 years
Conventional loan late - 2 years
Conventional loan current - No wait - borrower must be current on all obligations including installment debt
CREDIT SCORE - only late payments on mortgage will show and after sale, mortgage is normallyu reported as "paid as agreed or paid as negotiated - This can lower the score 50 points if all other payments are being made"
SOUR E: http://www.cdpe.com
If you short sale you will be liquidating your assets and lowering your credit score. The general rule is that you can not qualify for an FHA loan for 3-5 years after doing a short sale, and the only people that I see buying after selling short are those that get gifted money from family to start over. If you can borrow money from family to avoid having to short with the bank and protecting your credit you then would be eligible to buy with FHA which would allow for low down payment. If this is not an option, I would either stay put or plan on renting after your sell. Best
If you apply and are approved for a short sale because you don't have assets to cover the difference, the other posters are correct, your credit will take a hit. There is no way to figure out exactly what it will be, but as others have mentioned, there is normally a 2 year time frame from when you sell to when you are able to purchase again.
Good luck whatever you decide.
You're unfortunately stuck in the position of many Americans and I see it everyday. It is still possible for you to short sale your property and keep your credit in good standing, but it will get hit a bit. The reason is because the mortgage will be considered "settled" and not paid satisfactorily. An option it to owner finance a home and get the seller to do a short term balloon for say 3 years with no prepayment penalty. So after your credit recovers a bit you can then refinance and obtain the mortgage yourself through a bank.
I hope that helps.