Times are Tough on Credit – do we care?

The economy continues to be watched.  Homeowners, buyers and sellers continue to get on with their lives in various ways.  I was struck by a paragraph in a SJMN article I read this morning…

(the homeowner) has yet to receive a notice of default but he did receive letters this spring from his lender about the possibility of a short sale – selling the condo for less than he owes. 

“I have not responded to that,” he said.  For now, he’s sitting tight saving money so he can rent a place after foreclosure, which he considers nearly inevitable.

Are we getting to the point where homeowners don’t care about their credit history/score anymore?   CNN Money wrote a recent article sharing the most current credit hits to one’s report for various late or delinquent scenarios.  It reported that a short sale, foreclosure, or deed-in-lieu all account for a similar credit report hit – 85 to 160 point hit.  I wonder what the long term impact of people who don’t care about their credit will be?

Did the bank offer a loan modification option?  Loan modifications aren’t easy either but the persistent homeowners that I hear from directly have found some moderate to large successes.  Homeowners I speak with in this situation do what they can to find work or obtain other methods of income.  A couple options I’m seeing are people taking jobs outside of their areas of expertise, and also renting rooms.  Some people become overwhelmed and drained in their current situation.  This is all tough.

Contact a trusted advisor (not your neighbor, but bless our good neighbors) to explore all the options for YOU.  Get the facts.  Your Realtor may know of contacts and web resources to get you started on the right path out of a dilemma.

Cash is still king in the real estate world.  50% down screams “we’re strong”; 20% down says we’re “solid”; 10% down is on the weak side – for conventional loans.