Foreclosure or a Short Sale, Bankruptcy vs Credit Counseling / Consolidation

Hello there blog fan, or by now it seems as though I have fans! As the beat goes on with the world of credit I often get asked what will a foreclosure do to my credit, is a short sale better? The simple answer is it will destroy it, there is no magic to it. THE SCOOP, if you are one who took the 30, 60, 90 day late to get the short sale authorized then continue to make your payments until your property sells you will see much less of an impact. However if you let the property go, 30, 60, 90, 120, 150, 180, days the obvious answer is it gets beat up. But you say, John I sold my property in the redemption period, ha ha! I'm good aren't I? My friends, great job on the sale but the damage is already done and even if it says account paid, settled for less than full balance it still looks like a foreclosure with all those late payments on your credit, sorry. I do feel if you can sell it, in MOST cases my opinion is to sell it. Always consult with your Real Estate Professional and your don't forget your Tax Professional.

Bankruptcy VS Credit Counseling / Consolidation companies. First and foremost I am not an attorney, if bankruptcy is on your mind I have great attorneys for you to consult in this matter. I'm speaking from a credit stand point. Here we go friends, you can recover faster from filing bankruptcy than consolidating your debt in most cases taking less of a hit to your credit. Down side, it is harder to qualify for bankruptcy these days. Here is the the skinny of credit counseling, they consolidate your debt and make payments for you. If you are sending them $400 a month, almost half of that goes to them until their fee is paid. When they spread out your payments to your creditors you are not going to make minimums in a lot of cases. That means you are going to be taking lates on your credit. Chew on this piece of fat; if it takes you 2-3 years to pay your debt off, it will take another two years to get your credit back. 4-5 years total for this process. Bankruptcy, you can be looking pretty good again in 6 months and not have the debt. Not all the credit counseling companies work this way, but most of them do. I could go on and on, however I won't. If you have specific questions, you know where to reach me. I'm always around...

john@redphoenixco.com