Is a Short Sale Better than a Foreclosure?

Many homeowners in arrears on their mortgage frequently ask this question: Is it better to do a Short Sale or lose the home to foreclosure? The answer to that is usually a Short Sale is the best option. At least as of this writing it is. The reason for that is typically loan applications ask the potential borrower if they "ever" had a foreclosure. "Ever" as in "forever". Technically that means for the rest of your life you would have to confess that you once had a foreclosure even if it was 20 years ago.

This current mortgage crisis and recession will likely affect borrowers for the short and long term. Because of the huge foreclosure inventory lenders have learned a costly lesson. In the future loan applications will probably contain a question that asks: "Have you ever had a Short Sale."

To my knowledge this isn't being done yet. With foreclosures at a record high that means a lot of people may not easily be able to get a loan in the future. I believe with so many people being affected loan restrictions are likely to loosen but I don't expect that to happen anytime soon.

If you do find yourself in the unfortunate position of having to choose between a Short Sale and a Foreclosure the Short Sale may be best but as always seek professional advice before making a decision. This article is not intended to be legal advice. Rules are always changing so reader should seek professional counsel before deciding on the best course of action for their situation.

I have been doing Short Sales for a few years now. Sometimes when you're questioning homeowners they have plenty objections. Read how to respond to some of them at the following site. Also you'll find affordable Short Sale programs you can learn right at home. Go here: SHORT SALES OBJECTIONS