How does a Short Sale affect my Credit?

If you have already missed payments, whether they are mortgage payments, car payment, credit card payments, or anything that reports to the credit bureaus, your credit will already be damaged. A Short Sale will not “help,” your credit. It does prevent your credit from being damaged further. By most accounts, a Short Sale is much preferable on your credit report than a Foreclosure. So you are choosing the lesser of two negative reports. When you go to get a loan in the future, we have been told that lenders will look more favorably on Short Sales because you were proactive and cooperative rather than ignoring the situation.