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Short Sale will not hurt my credit as much as Foreclosure, right? As a REALTOR® I do hear that questioon often.  Short answer is – no that is not true.  Here is why.

So you made it through some of the toughest years in a while..you lost a job..then found a job, slightly lower paying than before..you cut some corners, trimmed some budgetary fat and learned how to make do with what you have and not want so much for what the guy next door has, but despite it all the time has come that you realize you have to consider a Short Sale or just walk away from the place you call home and take the Foreclosure hit to your credit.

You discuss, you GOOGLE, you listen to all the chatter and the one thing you hear over and over is – It does not matter- a Short Sale will damage your credit as much as a Foreclosure- so why deal with the aggravation?  Why not just walk away?

So is this urban myth or is it based on fact?  Some recent musings by FICO scientist Frederic Huynh sum it up this way “…the overwhelming majority of consumers with short sales have some other evidence of mortgage delinquency.”  Combine this with some studies that suggest 1 in every 2 homeowners that goes through a short sale will default on another account within 2 years the conclusion is simple.  This group is high risk.  So in effect all major mortgage catastrophes such as short sale, foreclosure, 90 day late, etc all get placed into the same part of the equation- the high risk part.

So in the end making the decision to either let your home go back to the lender via Foreclosure or deciding to work with the lender to do a short sale is a personal choice.  Only you know which decision will be best suited to you and your family.  The first step is to talk to a professional and learn your options.

Happy House Hunting in North Texas. If you need a REALTOR® to list your current home, or are looking to buy or rent in the North Texas region- Give Dawn a call/text 214-604-4561 at Avery Properties/Avery Realty Group- where Sellers Enjoy 4% Listings and Buyers Enjoy Cash Back!! (ask me how…..)