Summary: How does a deed in lieu of foreclosure affect someone's credit history and credit score? A foreclosure or a deed in lieu of a foreclosure are both considered highly negative for a credit score. Having a deed in lieu of foreclosure on a credit report will cause a credit score to fall and it may take up to seven years to drop off a credit report.
Q: We live in Michigan, where the housing market and economy are in disarray. I'm in a bad financial position and am wondering how a foreclosure or a deed-in-lieu of foreclosure will affect my credit history and score.
A: Unfortunately, the fact that your state is in the economic dole drums doesn't matter when it comes to your credit history and credit score.
A foreclosure and deed-in-lieu of foreclosure are seriously negative pieces of information on your credit history. They're just this side of bankruptcy, and they will drop your credit score by a hundred points or more, depending where it is when the bank forecloses.
It will take you several years of on-time payments to rebuild your credit, and as many as 7 years for the effect of either of these two unfortunate events to really clear away.
I hope there is a way for you to avoid either a foreclosure or deed-in-lieu of foreclosure. Please talk to a real estate attorney or HUD-certified housing counselor.
July 30, 2007.
Related Articles
Foreclosure And Your Credit Score
How to Improve Your Credit Score and What Makes A Good Credit Score
Foreclosure Affects Credit But Homeowner May Avoid Deficiency Judgment
Late Credit Card Payments Means Bad Credit Report
After Bankruptcy Discharged, Home Buyer Considered First Time Home Buyer For Mortgage Purposes
© Ilyce R. Glink. All rights reserved. This content may not be used, distributed, syndicated, compiled or excerpted in any medium or form without written authorization from Think Glink, Inc. For information on syndicating ThinkGlink.com please contact us.
Comments
No comments have been posted.