Why You Should Avoid Foreclosure

  • Foreclosure follows you – Home buyers will always have to disclose that they have had a foreclosure in any mortgage application that they submit in the future. This can have an adverse affect on their future mortgage rates and there is no seven year time limit on this item.
  • Credit score negative impact – Credit scores are lowered by 300 points (per loan) and along with bankruptcy, this is one of the most devastating credit issue you can have in relation to future credit availability.
  • Ineligibility for a Government Insured Loan – The homeowner will be ineligible for a government insured loan for the next 5 – 7 years compared to 2 years for a short sale. A foreclosure is one credit report problem that is almost impossible to be repaired.
  • Possibility of Deficiency Judgement – Your lender can seek a deficiency judgement against you to collect any amount they do not recuperate at a bank sale.
  • Negative in Employment Credit Checks – Many employers run credit checks on prospective employees and foreclosure is one of the top items that will put a potential new hire in jeopardy.
  • Potential Damage in Current Employment – Many current employers run credit checks and a foreclosure can put a current position in jeopardy.
  • Negative on Security Clearances – Security clearances and government positions – including but not limited to military and law enforcement – can be jeopardized by a foreclosure. Revocation of a security clearance can result in reassignment or loss.
  • Foreclosure has a Higher Tax Liability – The tax liability in a foreclosure may be much higher in a properly negotiated short sale since canceled debt will be higher in a foreclosure.
  • Do Everything You Can – While it may not seem like it now, there will be a time where your current financial troubles will pass. You will feel much better knowing that you did everything you could to avoid this devastating financial consequence that so many people face.
  • You Have Alternatives – As your experts, we will explore every option with you and work toward the best resolution. Call us to talk about the option of a short sale.

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