A Brooklyn short sale represents real value for the homebuyer, of course. But to some extent, it is also a boon to the seller. Being able to unload a property that’s underwater helps avoid the most dire credit consequences of a Brooklyn foreclosure.
But lingering credit damage can still result from any short sale – if the short seller allows it to happen. Should you find yourself in the short sale situation, be proactive in protecting your credit score. You will put yourself in a position to re-enter the market sooner than you think if you take action to improve a damaged credit score following a Brooklyn short sale. Here’s how:
- Sit down and write out a strategic monthly payment plan for all open credit accounts and loans. It becomes real when you put pencil to paper. If the total is unrealistically large, contact as many lenders as needed and ask to reduce the payment amount. Making on-time payments is how you will build and repair your credit.
- Apply for a secured credit card. It is tempting to use only debit or prepaid cards, but this does nothing to rebuild credit. Secure a credit card with a deposit, and then use it to make calculated purchases you know you can repay on time.
- Be on time with all rent, medical bills – and every other account. Immediately after a short sale in Brooklyn is the right time to downsize and be frugal — but you need to keep certain accounts — bills, rent, etc. — open. It cannot be overstated: the key is to make all payments consistently on time.
Not everyone escaped unscathed from the recent downturn, but it’s also true that lenders are now a lot more familiar with good prospective borrowers who could not avoid its consequences. Whether you have been through a Brooklyn short sale or not, if you are looking to buy a home in Brooklyn, do give me a call. I’ll put you in touch with my mortgage broker, and we will see how close you are to owning your next home!