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Issue
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Short Sale
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Foreclosure
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Credit History
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Upon sale, the mortgage company will report your mortgage as “paid”, “paid as negotiated” or “settled”
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Foreclosure will remain on your credit for a minimum of 7 years and permanent in public records
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Credit Score
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A Short Sale will affect your credit score by approx. 100 points. Late payments can have more of an impact
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Credit Score could be lowered a minimum of 300 points
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Employment
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Typically will not affect your employment
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Foreclosures can be grounds for immediate termination
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Future Mortgages
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You typically do not have to declare your short sale
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Foreclosures must be disclosed to future lenders
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Fannie Mae
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You may be eligible for a Fannie backed loan after 2 years
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You are ineligible for a Fannie backed loan for a minimum of 5 years
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Deficiency Judgments
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Deficiency Judgments typically can be negotiated down or away entirely.
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If the home does not sell at foreclosure auction, it will go through the bank REO system. The longer it takes to sell, the more the deficiency.
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YouTube Video - Your Path to a More Affordable Mortgage