Foreclosure Knocking on Your Door?
Home » Foreclosure » Foreclosure Knocking on Your Door?
There are a few stages to foreclosures – the later stage the more harsh the penalties to your credit rating. Thus, the faster you act, the better the outcome.
Here is a list of scenarios from worse to least-damaging in the foreclosure process.
Foreclosure
-Damage your credit rating for 7 to 10 or more years.
-You will not be able to get a conventional loan on a new home for at least 5 years.
- Most cases, the home will be lost
- The bank could sue for a deficiency judgment on the shorted amount
- Occupants can be evicted
Pre-Foreclosure
- Damage your credit rating but not as much as a foreclosure
- You’ll probably put your home up for sale as a short sale. You won’t be able to walk away with any cash in your pocket.
- If the home is sold via a short sale, the damage to your credit report and credit score is minimized
- If you sell your home via a short sale, you may not get a conventional loan for approximately 18-36 months.
Pre-Pre Foreclosure
- It can damage your credit rating if the back payments are quickly paid and damage is minimized.
- Depending on the amount of your original purchase and how many home improvements or borrowed equity has been made, you may have some equity left in the home.
