4 Simple Steps to Remove Short Sales from Credit Reports FAST

Hey, credit heroes. Short sales can really tank your credit score. Well, a short sale is when someone sells their home for less than they owe on it. It's really stressful and they can drop your credit score anywhere from 50 to 200 points. Ouch. But don't worry. Today I'm going to break down the exact steps you need to take to dispute a short sale, to get it removed and to boost your credit score. So you better stick around. My name is Daniel Rosen and welcome to Credit Repair Business secrets. In the 20 years since releasing my first credit repair software, I have helped thousands of businesses to scale from the ground up. And I've experienced many of the same challenges that credit heroes face. And I've learned proven ways to overcome them and succeed. Sometimes life happens and it gets to the point where you realize that you need to sell your home and you need to sell it right now. But maybe because of the market, you have to sell it for less than you owe. This is called a short sale and the loss is known as a deficiency. Short sales suck. It's a really stressful spot to be in. Plus, they can leave a huge dent in your finances and your credit. They stick around on your credit report for up to seven years. And because they happen when you sell your home for less than you owe, they make it much harder to get a new mortgage. In fact, depending on the type of loan, you could face a waiting period of two to four years before you can even try again. Now you might be thinking, if I can't afford my mortgage, why not just for foreclose? Well, the bank will try to convince you that a short sale is the better option because it helps you to avoid the stigma of foreclosure. Sounds good, right? But here's the truth. Most lenders don't care and they treat them exactly the same. Both get reported to the credit bureaus as settled, for less than the full amount or not paid as agreed. And that's a really important detail and I'm going to come back to that later. But really, the fallout for your credit is just as bad. But I have good news. I'm going to provide you with a great four step process for getting short sales removed from your credit report and getting your finances back on track. The impact of a short sale depends on what your credit was like before the sale closed. The higher your credit score was, the further it will fall. For example, if you had a good credit score, a short sale could drop it 100 points. But if you had an excellent credit score, a short sale could drop it as much as 160 points. Can you believe that? So if you have a short sale on your credit report, it is important to get it cleared. That's why I work so hard to find the secret to disputing a short sale. Here's the thing to remember. Remember that deficiency that I mentioned? Well, here's the thing. It doesn't just disappear because the house is gone. No, you've got to figure out if you still owe anything. And sometimes lenders will come after you for the money right after the sale closes. Other times they'll wait and hit you with a bill later on. Or worse, they may hand it over to a collection agency. And occasionally they'll ask you to sign a new promissory note to pay back the leftover debt. And rarely, you might get lucky and they'll forgive part of it. But here's the deal. Before you can dispute anything, you got to confirm your obligation to the deficiency. Why? Because owning up to it puts you in good standing with the lender. And when you're in good standing with the lender, you've got way more options. But when it's time to start disputing, here's why this is important. Normally, the first step to disputing anything on your credit report is removing conflicting personal information. But with short sales, basic disputing techniques often don't work. And that's because they're often easily verified. But there is a way to remove them. And this is what you need to know. Let's take a quick glimpse behind the curtain of the three main credit bureaus, Equifax, Experian and Transunion. They actually use codes to communicate with furnishers regarding the status of various accounts. So if an account is sent to collections, they have a specific two digit code that they use to indicate that the account was sent to collections. If the account is charged off, there's a two digit code for that. If your vehicle was repossessed, there's a code for that. But when it comes to short sales, there is no code. That code doesn't exist. Here's an example of a short sale on your credit report. And you can see that this was a mortgage with bank of America and that there were some late payments. But as you can see, it's not listed as a short sale. It just says account settled for less than full balance, just like a foreclosure would. The bureaus never identify short sales with a unique status code. They don't even use the term short sale. And that is the Secret to Deleting Short Sales from Credit reports okay, I'm going to log into Credit Repair Cloud and I'm going to show you exactly what to do. Before you get started, make sure you add the client into Credit Repair Cloud, complete their onboarding and import a credit report. And if you want help with these steps, join the Free Start Repairing Credit Challenge where my team will walk you through the software and basic disputing and you can sign up for that for free@startrepairingcredit.com okay, so I've already done all that. And don't worry, this is a demo client, so I won't be exposing anyone's personal information here. Here's how this works. Step 1. Dispute the short sale with the credit bureaus. And again, this is specifically for the bureaus. You can just send them a very simple letter in your credit Repair Cloud account. Navigate to the client that you want to work with and choose step three, Generate letter. And remember, I've already added their details and imported their credit report. Now we choose a round one basic dispute letter. I'm going to add a saved dispute item. Remember how I showed you the report earlier? Well, you can also add a new dispute item from when you imported their report. Next, you'll create your round one letter and I suggest that you use our AI letter generator and that way it creates a unique letter every time and and the credit bureaus won't know it's a form letter. So I'm going to click that and just like that I've got a letter generated for each of the three credit bureaus. Now, I like to personalize things just a little bit, so I want to go in there and make sure that that account or reference number is there. You could even just say this short sale is inaccurate. Please remove it now. Your client's ID and proof of address will automatically be included in round one letters if they've been uploaded into the client portal. Click Save and continue to print. I like to create a task to follow up in 40 days as a reminder to check for a response from the credit bureaus. From here, you either print and mail your letter yourself or you can use cloudmail to send the letter with just one click. If the short sale is removed, great. If not, you'll get a response stating that it was verified and you should then move to step two. Here's step two. Dispute the short sale with the lender. Now, this time we're dealing with the lender. The letter that you send them is also very simple. You can use A round one letter again. But in this case I'm going to use the furniture dispute letter from our letter library. So once again you go to step three, Generate letters. Choose round two plus and then choose Creditor Furniture Reporting the item. Click on saved dispute items and then choose the one you want and you can see it's listed here as in Dispute Dispute. The system will verify the address of the creditor or you can add your own. Then click Save and continue. I'm going to search for the furniture basic dispute letter and then I'm going to generate it with AI. Simply fill out the letter and dispute the short sale. But this time also make sure to request the current status of the short sale sale. And this is very important because when you receive a response from the lender, 9 times out of 10 the short sale will be verified. That may seem like a bad thing, but that's exactly what you need to get it removed. So step three is file a complaint. Okay, so now you have proof that the bureau's verified the item as a foreclosure closure. And now you have proof from the lender that it's actually a short sale. That sounds like a conflict, doesn't it? So now it's time to file a complaint with the cfpb, the Consumer Financial Protection Bureau. And you can file these complaints online@consumerfinance.gov after you file the complaint, be sure to save a copy or take a screenshot to because you're going to need it for the next and final step. Step 4 Send warning letters to the Bureaus. Now it's time to send a warning letter to each of the three credit bureaus with a copy of your complaint. So point out the facts and show your proof. So go to generate letters, choose a round two letter and select the credit bureau option. Add the same saved dispute item that you've been working on and you can search for the bureau warning letter in step three. By the way, this is all much easier in Credit Repair Cloud, but if you don't have Credit Repair Cloud, the warning letter templates are also available to download for free at creditrepaircloud.com dispute-letter-templates in the warning letter, tell them that they are inaccurately reporting a short sale as a foreclosure. And tell them that you filed a complaint with the CFPB and you're considering legal action if the short sale account is not removed immediately. And then save and print the letter just like before. If you follow these steps that I just laid out, you will almost always get a deletion. The credit bureaus understand that they're wrong and they will do anything to correct it. But there are some cases where the bureaus simply ignore you or respond negatively. And if that happens, there's one additional step that you can take that will get a deletion 100% of the time, and that is to contact an FCRA attorney. They'll often help you for free in return for getting part of your cash settlement. If you want to learn more about FCRA attorneys, check out my episode FCRA Attorneys for Credit Repair and one last note about this four step process. In some cases, the lenders will use the status code AU to mark a short sale. AU is a special comment code designed for random statuses that aren't significant enough to have their own status code. If the status code AU is used, then this method I just described may not work. And in that case you'd want to dispute the short sale based on other factual errors or go straight to an FCRA attorney. Here's my final point. Selling your home for less than you owe can feel like a gut punch. And to make things worse, a short sale can drag your credit score down by up to 200 points. And you're not alone in this. Millions of Americans have been in your shoes and the good news is that you can take control. The time to take action is now. Financial freedom is closer than you think. It all starts with these four simple steps. And I'll end by saying if you want to learn how credit repair can help to save you thousands on a mortgage, check out my tips here. And if you'd like to improve your credit score and discover how to earn extra income repairing Credit for others, check out my brand new Start Repairing Credit Challenge. So sign up right now and@startrepairingcredit.com and keep changing lives.