Should I Try a Short Sale if Threatened With Foreclosure?

If you have been unable to keep up with your monthly payments and are under the threat of losing your home in foreclosure, it might seem like you don’t have a lot of options and are financially cornered.  However, this feeling is normal when we experience stress and life-changing situations, although incorrect in this case.  You have several options if you are faced with a foreclosure and there are professionals who can guide you through them.

If you are being threatened with foreclosure in Miami, Florida, think of it this way: foreclosure is your worst case scenario. Not only will your lender take your house—they will charge you attorney and court fees related to filing the mortgage.  That’s why anything is better than a foreclosure, so it’s important to stop for a moment, take a breath, and find out your options.

One such option is a short sale of your home.  While most lenders aren’t particularly agreeable to the option, it involves you taking the initiative to sell your home for less than the amount of the mortgage.  The lenders will then weigh their options and either take the short sale offer or not.  Talk to anyone who has gone through a short sale in South Florida, and you might hear a different story.  Tales of multiple offers falling through at the last minute, endless “tire-kickers” traipsing through your home.  Sometimes there are better ways of resolving your problem.

A short sale will likely affect your credit somewhat—possibly as much as lowering your score by 200 points.  However, it is important to realize that this is not NEARLY the beating your credit report will take if your home is foreclosed on.  200 points can be fixed with a year or two of responsible credit use, but the after effects of a foreclosure will take longer.  

Still—a short sale will be a better option for you than a foreclosure.  A qualified bankruptcyattorney could lead you through the process and help you connect with a real estate agent who specializes in short sales.  Professionals on your side in situations like these are always an asset—the more, the better.