Short Sale or Foreclosure?
May 4, 2011
Decision?
The KCM Blog recently wrote the following article about which is better: a short sale or a foreclosure. Click here to view source.
Is a Short Sale or a Foreclosure My Best Option?
We get asked this question quite often. In a rapidly changing market, it is difficult to give absolute answers. Much depends on your family’s personal situation. However, if you realize that you can no longer make the payments, you may have to decide between doing a short sale or letting the home go to foreclosure. Here are three things you may wish to consider:
1.) Impact on Your Future Ability to Get a Mortgage
There are many different lending institutions, each with their own requirements when it comes to your ability to obtain a mortgage in the future. However, a common trend is to be much more lenient with someone working through a short sale rather than letting the house go to foreclosure. As an example, the Fannie Mae site, Know Your Options explains you:
May be able to get a Fannie Mae mortgage to purchase a home sooner (in as little as 2 years) than if you went through foreclosure (at least 7 years)
You can get further information here. However, in a rapidly changing environment, make sure you get the latest information available from the actual lending institutions mentioned.
2.) Impact on Your Credit Score
There has been much dialogue on this issue. The question is whether or not a foreclosure will have a more severe impact on your credit score than a short sale. A recent FICO study sheds needed light on this question. Here is a chart from that report.
The first chart shows the impact on the score for each stage of delinquency, and the second shows how long it takes the score to fully “recover” after the fact.
We can see that there is very little difference in impact on your credit score whether you choose a short sale or a foreclosure.
3.) Impact on Your Family during the Move
Usually a family asking this question is already experiencing major financial difficulties. This may be putting immense pressure on both parents and the children. If you allow your home to go to foreclosure, you move and leave it vacant or you stay waiting for an official to knock on your door demanding you move. That added burden can cause even more stress for a family.
In the short sale process, you work with the bank and pre-determine the day you will move. The new purchasers usually move in the same day. Your family moves with a plan and you don’t leave the neighborhood with a vacant house to deal with. There is a level of dignity in this type of move that does not always take place in a foreclosure situation.
Bottom Line
For several reasons, a short sale may be the better option for your family. It is best to get professional advice if faced with this decision.
Lake Tahoe & Truckee March 2011 Real Estate Sales Stats
April 8, 2011
We are continuing to see quite a bit of activity in the Lake Tahoe and Truckee real estate market! 88 homes sold last month! This makes a total of 184 home sales in our MLS for 2011.
The price range that continues to see the most activity is the $300K-$499K range. 33 homes in this price range sold last month. 20 homes sold in the $400K-$599K range, and 17 sold for $299K or under.
7 homes sold for over $1 million in March! The most expensive home sold for $6.3 million.
This information was taken from our local multiple listing service and is for the dates of March 1-31, 2011. Click on the image below for an enlarged version of the chart and more info.
Tahoe Donner Market Update – February 2011
March 7, 2011
13 homes sold in Tahoe Donner last month! This makes a total of 22 homes that have sold year to date.
2 of the homes that sold last month were short sales and 3 were REOs. The least expensive home sale price was $311K and the most expensive home sale price was $965K. The average home sale price was $539,895 and the median was $460K. The average days on market was 133 days.
87 homes are currently listed in Tahoe Donner. 11 of these are short sales and 5 are REOs. The number of homes on the market has come up a bit from last month. 19 homes are currently under contract. The absorption rate is around 22% and there is about 4 1/2 months supply of inventory remaining in Tahoe Donner. Click on the link for current homes for sale in Tahoe Donner.
Lake Tahoe & Truckee January 2011 Real Estate Sales Stats
February 4, 2011
The year is starting off on positive note with real estate sales during the first month of 2011. 44 single family homes and 19 condos sold last month.
The $300K-$499K price range had the most sales with 15 total homes selling last month. 14 homes sold for under $299K. 3 homes sold for over $1 million. The majority of the home sales were in Truckee (18 home sales) & Tahoe Donner (9 home sales). 8 short sales sold last month and 10 bank owned properties.
This information was taken from our local multiple listing service and is for the dates of January 1-31, 2011. Click on the image below for an enlarged version of the chart and more info.
Tahoe Donner Market Update – December 2010
January 5, 2011
25 homes sold in Tahoe Donner during the month of December. This makes a total of 222 for the year! The least expensive sold home last month was for $316,500 and the most expensive was for $1,055,000. The average home sale price was $522,829 and the median price was $480,000. The average days on market was 75 days. 3 of the homes were bank owned and 2 were short sales. There are currently 86 homes listed in Tahoe Donner. 16 homes are under contract. The absorption rate is around 19% and there is just over 5 months supply of inventory remaining in Tahoe Donner. Click on the link for current homes for sale in Tahoe Donner.
