Weighing Your Options With Short Sale Versus Foreclosure

Posted by adairsawyer on August 18th, 2011

Meeting the monthly payments on your Las Vegas home is no laughing matter; in fact a lot of people have been unfortunate enough to not be able to do this due to lack of funds. The economy is not helping, and pretty soon you might want to think about putting your home under a Las Vegas short sale. Your best options when it comes to this would be short sale versus foreclosure. Nobody likes to lose a home, but sometimes it really does have to be done.

Falling behind in the payments you have to make for your mortgage certainly is not something to be proud of, but at the very least you have the option of a short sale versus foreclosure to not let your past efforts become a total loss. When choosing between a short sale versus foreclosure, it pays to know what the similarities and differences are between the two options. It is easy to think that they are not the same when in fact some slight differences between the two may spell the difference between a good and bad outcome.

First, the similarities between a Las Vegas short sale and a foreclosure ought to be examined. In both scenarios of short sale versus foreclosure, there will definitely be an effect on your credit score. Then again, the effect could not be too damaging if you choose to go with a Las Vegas short sale and you only have a few months left that you were not able to make payments for the real estate. Suffice to say, a short sale versus foreclosure choice should make you yield to the former if you have been making payments for the mortgage for quite some time already.

Of course, some major differences do exist between a Las Vegas short sale and a foreclosure. First, the scenario might be that the mortgage company you signed up with approves the acceptance of net amount which you were able to get from your short sale. However, the money you make is not enough to cover the amount which you owe – which they also take into consideration. Any income that is the difference of what you owe and how much you were able to sell the house for is something the IRS will have to factor in. The best scenario is you might end up being able to avert any tax liabilities if the odds are actually in your favor this time.

Should the house be sold under foreclosure, you will not have tax liability because no consultation was made with your mortgage company. In the future, you will probably want to buy a house again; waiting time after an event like this will be around two years following the proceedings of a short sale but can go as high as six years if you go with the foreclosure option. Basically, these are the things you have to consider when you are weighing your options between a short sale and a foreclosure. Keeping these things in mind will surely help you arrive at a better decision even if you have to let go of your beloved home.

Choosing between a short sale versus foreclosure is a tough decision. For some people, they need to consider plenty of things before automatically going for a Las Vegas short sale to know that they really did make a sound decision about their home.