In the modern world, you must constantly ensure that your credit score stays high. Otherwise, it’s hard to even function. With a low credit score, you can’t buy a house, you can’t buy a car, and you certainly can’t move to find a new job. Unfortunately, your credit score is at least partly determined by how you repay your loans. Does a foreclosure wreck your credit? It turns out, the answer is yes- but there are many things you can do to help ease that blow like sell your house fast for cash.
How Foreclosure Affects Your Credit Score
When you are foreclosed upon, that means that you’ve missed too many mortgage payments for your lender to ignore. Instead of letting you live in your house for free, the lender takes it away and sells it so that they can regain some of their lost money. This can create huge problems for your credit score, which is based on how well you repay loans. Depending on what your credit score was before the foreclosure, your number can drop from anywhere between 100 and 160 points– a huge loss.
Preventing Foreclosure
While foreclosure might be one of the worst things that can happen to your credit score, there are plenty of easy ways to get around it. If you’re able to start making payments again, but can’t pay back the ones you missed all at once, talk to your lender to see if there’s a better way to redistribute that cost. If you’ve experienced a temporary financial setback that left you unable to work, you can apply for a forbearance, which puts your mortgage ‘on pause’ while you get back on your feet. You can also talk to your lender about doing a short sale, which sells the house for less money than you owe. Often working with a company like ours means selling your house fast for cash, a much needed resource if you’re at risk of foreclosure. There are plenty of ways to prevent foreclosure from wrecking your credit- but the first step in many of them is to talk to your lender. Try it today, and see how you can help change your precarious situation.
Is Foreclosure The End Of Your Credit?
Despite what it may seem like, foreclosure isn’t the end of your credit score. If you have a good credit score to begin with- somewhere in the 700 to 800 range- your score will only drop by about 100 points, and you can regain those over three years of continued payments. Moreover, there are plenty of ways to prevent a foreclosure, and many of them are as simple to arrange as talking to your lender.
If you’re in a situation where you need to sell your house fast for cash, contact us today. We can help. We buy houses in Stockton and in your area, and we can make an offer within 48 hours. Learn more when you contact us today.