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Foreclosure - No affect on FICO score

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eemjlh
Established Member

Foreclosure - No affect on FICO score

Hi, I was watching the news, this evening, and they were saying with so many people foreclosing on thier homes that credit scores are not going to carry as much weight as they should.  They said the reason is people should not be penalized during this mortgage crisis. 
 
Has anyone else heard about this?
Message 1 of 4
3 REPLIES 3
granny031350
Established Contributor

Re: Foreclosure - No affect on FICO score

Your fico score will be affected if a foreclosure reports.  The government is talking about lenders forgiving the deficiency balances for tax purposes. (any deficiency balance can be reported as income to the IRS unless you file BK and are insolvent)
Message 2 of 4
Anonymous
Not applicable

Re: Foreclosure - No affect on FICO score

I have not heard this!!! 
Message 3 of 4
Anonymous
Not applicable

Re: Foreclosure - No affect on FICO score

A foreclosure will still tank your FICO score.

The point that's being made by some such newscasters is that, since the amount of foreclosures is going up, more people are going to have tanked FICO scores, and thus having a tanked FICO won't be such a big deal.

This may have some merit, but in the meantime if I had a mortgage I'd certainly be working to keep it out of foreclosure if at all possible...
Message 4 of 4
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