Despite new guidelines, short-selling buyers’ FICO scores will take a hit

With generous new guidelines from Fannie Mae and Freddie Mac likely to stimulate large numbers of short sales by underwater homeowners, what impacts can these sellers expect to see on their credit scores? It’s a crucial question because short sales typically cause FICO scores to plummet, sometimes by 150 points or more. This, in turn, complicates sellers’ credit capabilities for years and makes additional borrowings — whether for auto loans, credit cards or new mortgages — [more]