Foreclosure is a frightening thing to think about, it not only means that you are going to loose your home it also means that your credit will suffer a blow that takes many years to recover from. There are ways to avoid foreclosure; one of those options that many home owners are taking advantage of is called a short sale. During foreclosure your property is given back to the lender and they have to title it in their name and maintain the property.

A short sale allows you to seek buyers that will be able to purchase your property at a reduced cost; you need to stay in constant communication with your lender to let them know that you are trying your best to sell your property. Even if you have a foreclosure date set you can still the property up until that time, the housing market can become very good for somebody who wants to purchase a home at below market value.

If you are able to find a buyer that qualifies to buy your property you can let your lender know so they can begin the paperwork to sell your house. You cannot make any money on a short sale option. All the proceeds go to the lender; you can also determine how the infraction on your credit is reported. Request that it be shown as a payoff instead of a foreclosure, if you use the same bank for your mortgage as for your primary banking then a business relationship should be salvaged.

The option of a short sale does alleviate you from the mortgage payments that you cannot make but it?s not a quick fix. There is a considerable amount of work that goes into creating a buzz about buying property that is in pre-foreclosure. Sometimes buyers will think that the property has been dormant or is not being taken care of because of a pending foreclosure.

To help you move your property from foreclosure to short sale its best to find a real estate agent that will help you get the word out, many agents work on commission so don?t expect them to be beating down your door. Appeal to their expertise on listing homes and selling homes. The short sale option gives you the lender a chance to be a home owner again once your stability returns. It also gives a new home buyer or seasoned buyer a chance to buy property below market value without bidding or negotiating. Always check with your lender to see how low they will go, you will need to make sure that everybody is on the same page during a short sale.

Recovering after a short sale or foreclosure should be done as soon as possible. Lenders are required to report your payment status to the three major credit reporting agencies. If you are able to short sale a property let your lender know, if a foreclosure does happen know that your credit score can drop 200 to 300 points. You will not be purchasing a home for a few years but you can still rebuild your credit during that time. Review your financial situation and use the time you do not have a mortgage payment to pay down other bills and begin saving money.

If you know of somebody who is facing foreclosure let them know about the short sale option. Many times people who are dealing with this uncertainty are not aware of their alternative opportunities. Offer to help if you can and get in contact with friends who you think might benefit from home ownership. Foreclosure doesn?t have to happen if you tackle this problem early.