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How will a short sale affect my credit?

The main advantage of a short sale is not having a foreclosure on your credit report. Short sales may still show up on a credit report as a “pre-foreclosure in redemption” status. Although this can result in a credit score reduction of 100 points or less, a foreclosure will usually reduce your score by more than 250 points. According to Fannie Mae, an individual that forecloses must wait 5 to 7 years, maintain at least a 680 FICO score in the last 2 years, and pay a minimum 10% down on a future home purchase. We have seen customers purchase a new home in as little as two years after their previous short sale.

Other Common Questions

California Association of Realtors

Important Notice

The Mortgage Forgiveness Debt Relief Act expires at the end of this year. Don’t get caught paying tax penalties by waiting to short sell. Click here to learn more.

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