…if neglected, are the results REALLY that bad?
Growing up, my dentist basically said that if I don’t floss, my teeth may fall out. Today, my creditors tell me that missing payments or doing a short sale may ruin my credit. Well, my teeth are all still here, and my credit score is in the mid-700s after missing eight months of payments and closing my own short sale about a year ago! What am I missing??
Two weeks ago, a new client came through our website with a home in Texas. Noting his email, I see ******@equifax.com. I immediately called his cell, thank him for his interest, and asked some obvious questions. In a nut shell he said, “short sales really aren’t that bad on your credit, and I’ve seen that first hand. I’d like to do one myself.” That got me to thinking – are short sales really that bad? How important is credit score, and is the adverse effects of short sale, foreclosure, and even bankruptcy REALLY that bad on ones credit score?
The answer is yes and no. Can the results be bad? Absolutely. But, recent evidence has shown that much of the potentially detrimental effects are only hype.
Before my short sale (investment home, one loan), my credit score was 729. After missing eight months of payments and short selling over $200k short of what I owed, my credit score dipped to 679. Now exactly a year and four months later, my credit score is back to 728. No deficiency has been pursued either, and not a single collection call.
I have a good buddy who went through a BK only a few years back, and his story is even better! Post BK, he’s structured a successful loan mod, has provided a great lifestyle for his family, and was just approved for a $40k car! What am I missing here?
I know I should floss more, and I plan to. But I’m also being told that I should worry about my credit sore, and I’m not! With over 25% of consumers showing a 599 credit score or less, I just don’t see credit score meaning as much as it used to. So, please let this be an encouragement to you. If you are in a pinch (we all are!), keep your spirits up. Once you go through what you are, many times it’s not as bad as ‘they’ say it will be!
Disclaimer: I am not a Dentist, Creditor, or Zoo Keeper. Rather, just an attentive and passionate Short Sale Guru.