Short Sale Pro and Con

Short Sale

If you cannot bring your loan current, afford to make payments moving forward, or are unable to sell the property for the full amount of the loan, your lender may accept less than the amount owed as full payment.

PRO: Under the terms of a short sale, your lender may forgive your mortgage debt in its entirety according to the terms outlined in The Mortgage Debt Relief Act of 2007. Fannie Mae has announced a reduced mandatory waiting period to establish credit history to 2 years after the completion of a short sale. This mandatory waiting period after a short sale is lower than the required 5-7 years following a foreclosure.

CON: You must sell your home.