What is currently a million-dollar question was just a 25-cent question a short while ago, simply because everybody already understood the solution: How much time will it take for your credit ratings to get better from a short sale or a property foreclosure? Many years, right? These types of incidents stay with your credit report for 7 years and short sales are recorded as either charge-offs or debt settlements. These 2 incidents, in addition to home foreclosures, are significantly damaging and may considerably harm your credit ratings for several years.

So just why has this all of a sudden turned into a subject of debate, discussion, and inconsistent answers? Simply because in March 23rd’s American Banker, Barrett Burns, the CEO of credit score provider VantageScore Solutions claimed, “…it can take consumers less than 9 months to correct their credit rating following a short sale or property foreclosure.”

Amazing, that’s very good news! Or is it? I discovered this hard to believe. The bottom line is this: You cannot completely fix your credit score within nine months unless you can persuade the credit agencies to eliminate the items from your credit file. And as long as the items are correct they will stay for 7 years. Your ratings will start to heal over time because the item ages   and loses predictive importance, however sadly it will not take place after just 9 months.

So how do you convince the credit agencies to permanently remove bad items on your report? Normal credit repair companies simply send dispute letters out to the 3 major credit bureau and hope that they can dispute the claim long enough that it will be temporarily removed while you apply for a new credit card or home loan. This however is not a 100% solution because during that time the items can come back and you’ve just been out the amount of money you spent to try to fix your bad credit.

So we went on a search. As realtors we run into people every day that have bad credit and cannot get into a home simply because their score is just a few points lower than what is needed to qualify.

We have found the one and only company that is 100% effective in permanently removing negative credit items from your credit report.  They go about this by using a little known law which requires the credit bureau to have written documentation of the debt on file. But because the credit agencies are soooo massive, this becomes an impossible task.

We can’t really do the company justice is describing the process. Just go to their site at www.mycreditscorerestored.com. We have sent hundreds of our real estate clients to them and have had amazing success. Their friendly and don’t charge an arm and a leg like other companies we have tried.

A notice of default is a notification presented to a debtor saying that he / she did not make their repayments by the established deadline. It demands when the funds due (in addition to any extra legal fee) isn’t given in an assigned period, the loan provider might determine to foreclose the debtor’s home. Any other individuals which can be impacted by the foreclosure may well additionally be given a copy of the notice.

You’ve presumably received this notice of default or  “NOD” because you haven’t made repayments for three or more months. At this time the Property foreclosure procedure has started you’ve got roughly ninety days until eventually it will go to Foreclosure sale.

Defaulting on a person’s mortgage results in the start of foreclosure often called Notice of Default, the procedure in which the loan provider will take over the property so that they can recuperate their principal investment. The moment the home or property is either purchased at public sale or “repossessed” by the financial institution, it is sold and the previous owner must vacate at the discretion of the new property or home owner. Whenever there’s a power of sale clause in the deed of trust the non-judicial procedure of property foreclosure is utilized.

In a great deal of states, the timetable of non-judicial property foreclosures starts once the trustee records a notice of default. This is a notice which is delivered to the owner/trustor notifying him or her of the failure to repay the home loan. This informs the householder of the intent of the loan provider to follow through with their right to recover on the debt. The copy of the notice that is documented with the County Recorder’s Office in the applicable county, is sent by mail to the address of notice according to the deed of trust. Recording of the notice of default can differ significantly with regards to the named beneficiary.

It may take place anywhere from 7 days to several weeks following a person missing his or her 1st loan payment. The action which follows next will be the phase of the property foreclosure procedure in which there’s a filing of the Notice of Trustee’s Sale. No earlier than 90 (ninety) days following the trustee records the Notice of Default, the Trustee will have to publish a notice of trustee’s sale in the local newspaper and at the same time document that notice with the county recorder’s office. No earlier than 20 days (twenty) following the notice of trustee sale is submitted, the property can be offered for sale at public auction for the sum of the debt in addition to property foreclosure expenses. If no person bids in the auction, the lending company takes on possession of the property, and may dispose of that real estate to recuperate their cash investment.

This can be avoided by speaking with a realtor which understands the procedure and will negotiate with the loan company a  ” short sale”, the advantage for you is that 1: it may get a person extra time and 2: a “property foreclosure” is not going to show up on a person’s credit history, this is critical should you ever want to purchase once again.

We have created a Short Sale negotiation team that can fight on your behalf and help you. If you have received a notice of default and believe that you may need our assistance, please don’t hesitate to contact us day or night at (503) 891-4860 or feel free to send us an email at info@ssboh.com

In general a short sale will happen when someone is behind in the mortgage payment and have some sort of financial hardship that has recently occurred. The homeowner will contact the bank or mortgage lender and ask the lender to allow them to sell the house for less than the balance of the mortgage.

For example if someone owns $250,000 on their home but are only able to sell the home for $220,000 due to be current market conditions, the lender will agree ahead of time to allow the sale to proceed many banks will allow short sales in an attempt to prevent property from falling into foreclosure. Usually no bank will allow a short sale unless the homeowner is already behind on their mortgage payments as well as the lender would like to see evidence that the homeowner can no longer afford the payments on the home. Most of the time they will also like to see some sort of documentation such as your income and assets to make sure that the homeowner is going through financial hardships.

If your bank approves a short sale, your next step is to find a real estate agent that is a short sale expert and are able to help you find a buyer for your property. Once a buyer is found and an offer is placed on the home, the bank will have the final say on whether the offer is approved or not.

In some cases if you are successful in selling your home in a short sale you could still be liable for the difference between the amount you owed and on the mortgage and the lost amount for the sale, this is referred to as a deficiency balance. If you have a deficiency balance the bank may be able to pursue you for the remainder of the debt. This scenario depends on the state law in which your home is located and these questions can normally be answered by a short sale expert.

When it comes to short sales and your credit score, any short sale has a negative effect on your score however it is much less damaging than a foreclosure. A short sale will not appear as a foreclosure on your credit report and only the delinquency on your mortgage payments will appear. Most banks will report a mortgage that has been paid through a short sale as being in redemption status. The delinquency and change of status under mortgage will lower your credit rating but the negative impact is usually much less than a foreclosure from a credit perspective. The other thing to note when doing a short sale or foreclosure is that a short sale will not allow you to purchase another home on with a mortgage within one year however a foreclosure will stay on your credit and will be a matter of public record for three years.

If you have any questions regarding short sales or need any questions answered regarding the process, please give us a call day or night at 503-941-5685. Our team of experts are more than willing to help you out.