YIKES! You've got some bad answers here and an odd question.

Q: , "What's so bad about foreclosure?"
A: Aside from ruining your credit, making it where you can't purchase a home via regular means for 5 years and leaving yourself open to deficiency judgements for the difference (you know, the amount the bank doesn't get at the court house), I guess nothing.

What EXACTLY Happens to your credit?
The bank reports to the credit bureaus that you were not only delinquent but that you did not fulfill your obligation and they foreclosed.

In short, you won't likely be able to buy any big ticket items for about 5 years without people who make "business" decisions looking at you funny (and charging you extra % since you might be more likely to make another business decision).

TRUE OR FALSE?
".. but here in Georgia, you would not qualify for a short sale if the property in danger of foreclosure is not your primary residence." FALSE!

Sorry, but I've closed successful short sales on MANY investor owned short sales. I know others on Trulia that have too!

Chaka, I don't know about what is happening in other states, but here in Georgia, you would not qualify for a short sale if the property in danger of foreclosure is not your primary residence.

Your credit will take a huge hit and you you will likely not be able to buy anything on credit for a long time. The bigger issue is if the bank decides to pursue you for a deficiency. Then you still owe the difference between the value of the loan and what the home sold for. This can come in the way of liens attached to your home, wage garnishment, etc.
If there is a true hardship you may qualify for a short sale and at least you would have some power in negotiating how the deficiency is handled. That is still a better option than a foreclosure.

Good Morning Chaka..... "food for thought"........ A "ding" to your credit rating may not be the only problem you would be facing in the event of a foreclosure. If an investment property is sold at auction for less than what is owed, the lender may hold you responsible for the deficiency, or they may send a 1099 to the IRS declaring the amount of their loss on the property as income to you, resulting in additional taxes to you. Weight all the issues before you decide and then make the decision you can best live with.

Good lucx...

Yvonne Baker, Real Estate Consultant http://www.YvonneBaker.com
ycbaker@kw.com

OK...this would be a business decision, not a moral one. Let's get beyond this argument. It's just as "moral" as the decision many public companies make every fiscal quarter to lay off workers.

My question is, what EXACTLY happens to your credit?
~~~~~~~~~~~
Hey who cares? It's a business decision! @@

Can you tell me what EXACTLY are the consequences if I go down to the corner jewelry store tonite and break in? The information is for a business decision I have to make.

Chaka,

For most people it seriously effects their credit. Be sure to get all of the details about foreclosure. Most people do not have a complete understanding of their debt obligation after foreclosure.

We recommend contacting a real estate attorney for this insight.

"Nothing if you don't care about buying anything on CREDIT. "

Won't this be off of my credit in 7 years, and less of an issue on my credit after only 3?

"Of course, there is that whole moral question of paying obligations that usually weighs pretty heavy on people."

OK...this would be a business decision, not a moral one. Let's get beyond this argument. It's just as "moral" as the decision many public companies make every fiscal quarter to lay off workers.

My question is, what EXACTLY happens to your credit?

Chaka,

"What's the worst thing that can happen to their credit if I let it go into foreclosure?"

- If it's not your primary and you have renters it's not THEIR credit that can be ruined, it's yours.

What's so scary about foreclosure?

Nothing if you don't care about buying anything on CREDIT. Personally, I think cash is the way to go it makes a lot of sense. If you can go to an all CASH life, then more power to you. Depending on the situation being forced out of your home by a guy with a gun (Sheriff) is kind of scary too....

Of course, there is that whole moral question of paying obligations that usually weighs pretty heavy on people. I know it'd be pretty scary to be going into foreclosure, because that would mean I couldn't pay what I was previously paying. ... Might not be a problem for you though.

A lot of your questions might be answered on the website below.Federal law (Fair Credit Reporting Act) requires that any negative remarks be removed upon request after 7 years (except for bankruptcy filing, which may remain for 10 years). If you don't ask, it won't go away.