When you’re underwater and struggling to stay afloat on a house, short selling may seem like the best idea.
And for many, it definitely is, but there are downsides that you should consider. First, when you short sell, you may not have the months of being in your home with no payment that foreclosure gives many people.
This time without house payments can help you rebuild your finances and ease your transition if you end up moving.
Second, and contrary to popular opinion, short sales damage your credit, and the better your credit is, the bigger the blow a delinquency on your mortgage amounts to.
If you’re trying to short sell to protect your credit score, it may not have the effect you had hoped.
Finally, your lender may come after you for the difference anyway. Using a so-called Deficiency Judgment, your mortgage company can sue you for the difference between the amount of your loan and the price of your home in the short sale.
Many New Yorkers end up filing for bankruptcy at the end of a short sale or foreclosure to clear the mortgage company’s deficiency judgment.
If you’re struggling with your mortgage and considering a short sale, call the Queens foreclosure attorneys at Zelenitz, Shapiro & D’Agostino at 718-599-1111 to learn all your options, and the best way to protect your credit and save your home.