Short sale - credit report

How does a shortsale show up on a credit report? Got someone that has a house worth somewhere in the $260k’s ARV, owes $228k, owner thinks it will need about $60k in updates to get it up to snuff with the rest of the neighborhood. Realistically it probably can be done for a little less than that and keep it upscale and nice. Of course this isn’t a good rehab candidate if bought at what she owes. I thinking this can be shortsaled, i’m waiting to hear back from her regarding whether it has a second note as part of that $228k or not and who the lenders are.

It depends.

Either the bank issues a deficiency judgement which shows up on your credit as long as it remains unpaid, or it’s a 1099, which doesn’t show up at all. But the payoff on the mortgage will still show ‘paid deficient’ or words to that effect.

What’s it worth now?

Well at this point I think I am going to persue a refi for her and help her out of this hole. I won’t make any money but seeing that her money problems seem to be only temp problems caused by sick relatives and a crappy ARM she might be able to get past it. I have a post in the financing forum about her.