RE/MAX Metro Realty Inc.
Carlo Delizo & BENCHMARK TEAM

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SHORT SALE vs. FORECLOSURE

***Besides living with the stigma of having “F” (foreclosure) on your record for the next 10 years or so, here are a few things that you might want to consider:
 

 

 

1.) How soon can I qualify for a new mortgage loan to buy another home?

In a short sale, borrowers must wait at least 2 years before they may qualify for another mortgage loan. 

In a foreclosure, borrowers will have to wait a minimum of 5 to 7 years depending on other factors.

Under special circumstances, as such with military personnel relocation, as long as they are not late on their mortgage payments, they may do a short sale and qualify for a new mortgage loan to buy another home right away.

2.) Do Junior Liens (2nd Loan, Et. Al.) go away after foreclosure?

In WA State, the junior liens are extinguished by the foreclosure BUT the debt survives. In other words, junior liens become UN-secured debts after the foreclosure and the creditors have the right to come after you for the entire debt plus court costs, penalties and interest. Junior creditors may sue you after the foreclosure. And if a judgment is recorded against you, it can be attached (as a lien) to any of your properties that you currently own or purchase after the foreclosure.

In a short sale, you have the chance to negotiate a settlement for all of the junior liens; and in most cases, the 1st lien holder may contribute monetarily to help settle the junior liens for a lien-release and full settlement of debts (a payoff for less than the balance owed).

3.) How about Deficiency Judgments for the short-fall?

Deficiency judgment is a monetary judgment against the borrower whose foreclosure sale did not produce sufficient funds to pay off the entire mortgage debt. The lender’s right to come after the borrower for the short fall (deficiency) after a foreclosure depends on the State where the property is located.

In Washington State, the foreclosing lender loses the right for deficiency judgment. – It’s usually the 1st position lienholder who forecloses on a property. But as discussed in Section #2 above, junior debts survive the foreclosure.

4.)
How about relocation incentives?

In a short sale, it’s been known that banks may pay out between $2,500.00 - $45,000.00 in relocation assistance to the homeowner depending on their individual qualifications and circumstance. Want to find out if you qualify? CLICK HERE

In a foreclosure, some banks may offer a very small amount of money to the occupants in lieu of evicting them. This amount is miniscule in comparison to what lenders would offer in a short sale. Most banks, however, will offer no relocation incentives and will proceed with an expedited eviction process. The occupants may risk having an eviction judgment against them if they don’t move out in a timely manner.

5.) How does short sale or foreclosure affect my credit rating?

In a short sale, you credit score is lowered by the mortgage late(s). But as long as you keep up with your other obligations, your score generally does not drop more than 105 points. As the mortgage late(s) gets older, your score will gradually increase.

In a foreclosure, your credit score takes a nose dive. It’s been projected to lower your score between 150-200 points depending on other factors.

6.) Can I qualify for a rental after?

Landlords have much respect for prospective tenants who have gone through a short sale. Landlords understand that short sale is the dignified way to settle a debt as opposed to walking away. In most cases, as long as you’ve kept up with your other obligations and your credit score is still above 640, Landlords are more likely to take you as a tenant.

Landlords, however, may not rent out to someone who had a foreclosure. And if they do make an exception, they may raise the monthly rent and require an enormous amount of security deposit along with the customary advance rent payment for first and last months. If you have an eviction judgment against you following the foreclosure, good luck finding a rental!

7.) How does short sale affect my employment?

Depending on the job type, employers may run a credit check prior to hiring and they might re-run credit credit checks throughout the employment period. In this case, having a foreclosure will most likely disqualify you. And since short sale doesn't hurt your credit as badly and provided that you've kept up on your other obligations, your chances of getting disqualified for this very reason would be very slim to none.

Check out the "Short Sale Vs. Foreclosure" Video by clicking here.

Do you qualify for a short sale? Please call (800)780-0226.

 

 

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What our clients are saying  

I just wanted to thank you for all of your help in finding a home for my family. We've gone through this process for almost nine months and you've stayed patient, positive, consistent and worked hard for us through this whole process. Lynn and I are very thankful that you were able to save us from the many pitfalls we could have fallen into such as the new construction property in a flood zone that the builder didn't even know about, many overpriced homes and homes in general that you didn't think would be a good fit for us. One thing I know for sure is that I won't ever be using another agent for my future real estate purchases because your overall level of service and expertise is above and beyond everyone else in my opinion. CONTINUED...

 

~ Andrew & Lynn B.

Finally, I don't know how you managed to do this in this crazy sellers market but THANKS for negotiating our home pruchase down over $40,000 which is over 8 PERCENT of the sale price!!! Your negotiating skills are beyond exceptional! Thank you again for getting us into our dream home at the dream price. You've got a customer for life.

 

~ Andrew & Lynn B.

Carlo has helped myself and my family find the right home for the right price; and had gone above and beyond what was expected of anyone. I got sick during the process and was not able to complete many of the necessary steps in the home buying process. Carlo spent countless hours of his own time helping my family through those rough times and I would recommend him to anyone. He is very thoughtful, friendly and most of all honest. I also consider him my friend. Thank you Carlo,

 

~ The Lockwood Family

After renting an apartment for 2 years and looking for a house for 1 year, we finally get the right house for us. The whole home buying experience was great because of our very hard working property broker. We got exactly what we are looking for in our 1st home! We are now officially home owners!!! We are so excited and happy. Stay tuned for our house warming soon!

 

~ Renee Ashley

We are officially home owners!!! Thank you Carlo for helping us get our first home. ...I just knew you would be the one that can help us get a great home. All your hard work and experience is very much appreciated. You made the whole experience enjoyable.

 

~ Jade A.

Carlo, Thanks for everything! I had more than a satisfactory experience and I would for sure recommend you to anybody that I know in the Seattle area whose either buying or selling. ~ Dante

 

~ Dante D.

Carlo, Thanks for being an awesome real estate agent! The condo is amazing and look forward to working with you again in the future! I hope that you enjoy this rye as much as I do! It is my favorite!

 

~ Jonathan M.

Hi Carlo, Thank you so much for all your help and patience with working with us to short sale our home. You have done an awesome job and we will definitely recommend you to any one we know. All the things you have said has happened. Can you come out to dinner with us after this is over to celebrate? Have you been to the Crab Pot in Bellevue? Thanks

 

~ M. & L.

Hi Carlo, Thats really great news, You are a superhero!... Thank you so much for your hard work and patience.

 

~ M. Villasin

Carlo, There aren't enough words to express our gratitude! You were very thorough and kept us in the loop through the entire process. We were amazed how on point you were with EVERYTHING, even down to the week we would close on a deal. Everyone we told were amazed about how fast and smooth everything went. Your knowledge and expertise is top notch. You have truly exceeded our expectations. We will recommend you to everyone! Thank you for everything!

 

~ M. & A. Bauer

No words to say but " THANK YOU! ", will pick the keys soon and leave some thing for you at your office. I am not well lately, so moving slowly. Take a good care of yourself and wish the BEST to your BUSINESS!! God bless your parents.

 

~ S. Chen

Carlo, Greg and I would like to take this opportunity to properly thank you for representing and even advancing our interest to the best you could. We could not ask for any broker as knowledgeable and as professional as you are. We are forever grateful! If your website has a page for testimonials, we would not hesitate to put in good words for you. Nonetheless, rest assured that we will never hesitate recommending you to any one needing of your expertise.

 

~ Mr. & Mrs. Pangilinan

Congratulations on your 100% Club award! Thank you for being a part of our team, we are honored to be a part of your success. Keep up the great work!

 

~ David Milot, Owner of RE/MAX Metro Realty Inc.

Thank you for taking the time to explain everything to me. Thank you so much for all your help. We can finally move on.

 

~ Mai P.

(via Facebook timeline) Best agent!!! Thank you!!!

 

~ M. Capiral

(via e-mail) Hi Carlo! ...I really appreciate the patience you have with us all the way through the process. We need to take you to dinner!

 

~ H. Nguyen

Dear Carlo, Thank you for taking so much time showing me properties and helping me learn. I appreciate your knowledge and professionalism. I am looking forward to working with you again. Sincerely, Joyce Pier (425)486-XXXX

 

~ Joyce Pier

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