Home Selling in 76707>Question Details

Abygail Sand…, Both Buyer and Seller in 76707

We are applying for a short sale on our house because of the raising crime rate in our neighborhood. We wanted to know if this would effect our credit

Asked by Abygail Sanderlin, 76707 Wed Jun 9, 2010

The short sale is already in process and oen person told me it wouldn't effect our credit and today I was told it will. We has a credit score of 779 and we are very proud of it and would hate to loose it but we are desperate and want out. I have two kids 2 and 8 months I am also a stay at home mom and have to deal with the drama of the neighborhood. We need advice. Please help if you can.

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Yes, it will affect your credit, but can you put a price on your safety and that of your family? Sometimes what is best is not always easy, but it sounds like you have made the right decision. Best of luck!
0 votes Thank Flag Link Sun May 29, 2011
Yes, It will lower your score - but no one can know for certain HOW MUCH. I recently moved from WACO after a man tried to abduct my 6 yr. old dauughter right in front of me in my own yard - Waco PD would do NOTHING! The next day I walked off and left my home (which was completely paid for!!) and moved to Marlin.
YES, crime really IS that bad in Waco; 11 robberies in 11 days was reported in last Friday's paper, and then on Monday, they reported 3 more that weekend! My Motorhome was stolen, it was PAID for, and Waco PD refused to even take a report, said to "Call my bank", I did not owe any money on it, so how could calling my bank help me? Every time I pick up the paper, there is another child raped and/or molested - even the grade school teaxhers and coaches are the guilty ones. I could go on all day, but that should give you the idea.
I will have to sell my house in Waco for whatever I can - My child's safety is FAR more important than any house or money!!! Houses in Marlin, are CHEAP, lots of forecloures are available, and the banks are willing to deal with you if you give them an offer. I got a REALLY good deal, on a NICE house in a NICE safe neighborhood!!
Can you try to buy another house before you sell your current one? If so, that way it would not affect your credit score until AFTER you do the Short Sale, and you would not have to wait the 2 years or more to be able to buy another house, and you would still get a low rate today. I mean buy another one now, and then do a "Short Sale" later - OR lease it - even if only until it sells.
If you are a Veteran and are eligible for a VA loan, that might help you get out of WACO! My child is now 9, and everytime we go to Waco to shop, and return home, she says, "Well, Mom, we made it out of there ALIVE, one more time!"
I will keep you in my prayers and ask God to help you find a SAFE home you can afford. God be with you - Susan
0 votes Thank Flag Link Sun May 29, 2011
Yes it would lower your score. You age agreeing to take a small ding in your credit for a reduction in sale price. It will prevent you from buying another home for a minimum of 2 years, however, if you keep up with your debt, after 2 years, you should be able to qualify for another government owned mortgage but no guarantees if the interest rate will be affected.
0 votes Thank Flag Link Thu Jun 10, 2010
Our agent is being very helpful but, I think that she is being optimistic. And I want to know all views. To the question about Waco's crime rate, in some areas it is good but in ours it is slowly getting worse. We had a chop shop that was being run right behind or house and that situation was bad for me they thought that I was the one who said some and I was theatened by the man who was being arrested. We have had enough and I honestly fear for my life and my kids. We have seen drug deals and cops come around on a weekly basis. We just want to get out before something bad happens. We are model americans. We are debt free and pay all our bills on time. We just want to look at all of our options. All the advice that has been given is very helpful and I thank all of you!
0 votes Thank Flag Link Thu Jun 10, 2010
Hi, Abygail,

Any time you ask a lender to accept less than you agreed to pay, it will affect your credit. IF values have dropped drastically, and IF you can demonstrate genuine financial hardship, then a lender MAY consider allowing a short sale. Their acceptance is never guaranteed, and getting approval has gotten more difficult.

You may be better off putting a renter in that house (if anyone wants to rent there) and moving your family to another place. If your agent isn't giving you these kinds of options, you might ask why, and maybe find an agent who can look at the big picture for you and not just the next deal.

Good luck,

Web Reference: http://TellEllen.com
0 votes Thank Flag Link Thu Jun 10, 2010
It will affect your credit.
How much we don't exactly know.

I am shocked there is that much crime in Waco that you need to move?
That suprises me.

Any chance you and the neighbors can get together, start a crime watch and improve the neighborhood?
I would try to meet with your CRO at the police department. Maybe they have ideas for bike patrols, increase car patrols, etc.

Good luck.
0 votes Thank Flag Link Wed Jun 9, 2010
Bruce Lynn, Real Estate Pro in Coppell, TX
Yes a short sale will impact your credit, but like previous answers said, only half as much as a foreclosure. Talk to an accountant and mortgage specialists to see if I'm right, but it is my understanding that with a short sale you cannot qualify for another mortgage for at least 3 years.
Another option is a deed in lieu, where you basically give the house and keys back to the bank. Whatever you do, Texas is a recourse state, which means if you sell it for less than you owe, the bank could still sue you for the remaining balance.
And like Don mentioned, you still have to declare the money as income.
0 votes Thank Flag Link Wed Jun 9, 2010
You mentioned that the Short Sale is already in progress. That leads me to believe that you have your home listed with an agent. If this is true, Why is you agent not answering these questions?

The Short Sale most certainly will affect your credit rating. The amount will be determined by the settlement you make with your lender(s). As a Seller, this is not about selling your home, it is about settling your debt. The sale of your home is only a part of the settlement.
0 votes Thank Flag Link Wed Jun 9, 2010
I agree with Anna and also know that there have been new laws passed allow for the amount of debt to be forgiven and not counted as income. In the past If you had a short sale and sold the property for $25,000 less than what you owed the mortgage company would consider that money income and send you a 1099. Consult an accountant to verify that this will not happen to you.

You can read more about Mortgage Forgiveness Debt Relief Act and Debt Cancellation Act at the following address: http://www.irs.gov/individuals/article/0,,id=179414,00.html

Best of luck to you.
0 votes Thank Flag Link Wed Jun 9, 2010
Yes, the short sale will lower your score, however the negative credit impact of a short sale is generally less than that of a foreclosure--much will depend on how many months behind you are on your mortgage payments, how the short sale is negotiated, how it's reported to the credit bureaus, etc.
0 votes Thank Flag Link Wed Jun 9, 2010
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