Foreclosure/Short Sale Credit Reporting Traps
Do you know the difference between a foreclosure and a short sale? Your credit report does not. In fact, there is no code for “short sale” in “credit speak.” The credit reporting agencies will either report you as in foreclosure or not. That’s a very big problem, because many homes have been sold via short sale without ever having been in foreclosure.
We have successfully sued several banks and credit reporting agencies over this issue. A foreclosure on your credit report, when you were never in a foreclosure, is a kiss of death to your credit. A short sale, again, is never mentioned because no such code exists for the credit reporting agencies to report one.
If you have ever sold a home via short sale and foreclosure proceedings were never initiated against you, then you must check your credit report to make sure that the transaction is not being reported as a foreclosure. If it is, you should call us immediately so we can get it cleaned up.
MICHIGAN CONSUMER CREDIT LAWYERS
Southfield, MI 48033