SoldPHXShortSaleAZ

Your Options — Honest Pros & Cons

Foreclosure is rarely the only option. Here are the six real paths Arizona homeowners take — what works, what doesn't, and how to choose.

Short Sale

Best when: You owe more than the home is worth and have a hardship.

Pros
  • ✓ Lender forgives the shortfall
  • ✓ Costs you $0 out of pocket
  • ✓ Credit recovers in ~2 years
  • ✓ You stay in control of the sale
Cons
  • ✗ Takes 60–120 days
  • ✗ Requires lender approval
  • ✗ Need to document hardship

Loan Modification

Best when: You want to keep the home and have stable income.

Pros
  • ✓ Lower monthly payment
  • ✓ Stay in the home
  • ✓ Avoids any sale at all
Cons
  • ✗ Requires income that supports new payment
  • ✗ Can take months and may be denied
  • ✗ Most modifications fail within 2 years if income hasn't recovered

Forbearance

Best when: Your hardship is temporary (a few months).

Pros
  • ✓ Pauses or reduces payments short-term
  • ✓ Quick to set up
Cons
  • ✗ Missed payments must be repaid later (lump sum or added to loan)
  • ✗ Doesn't solve a long-term problem

Deed in Lieu of Foreclosure

Best when: You can't sell and want out of the loan without foreclosure.

Pros
  • ✓ Avoids the public foreclosure record
  • ✓ Less harmful to credit than foreclosure
  • ✓ May include cash-for-keys
Cons
  • ✗ Lender usually requires you list the home for sale first (a short sale attempt)
  • ✗ May still owe a deficiency in some cases

Sell with Equity

Best when: Your home is worth more than you owe.

Pros
  • ✓ No foreclosure, no short sale, no lender approval
  • ✓ Walk away with cash in hand
  • ✓ Fastest option (30–45 days)
Cons
  • ✗ Requires real equity
  • ✗ Still costs you standard selling fees

Bankruptcy

Best when: You need to halt a foreclosure sale immediately or have broader debt issues.

Pros
  • ✓ Automatic stay halts the foreclosure auction
  • ✓ Chapter 13 can let you catch up over 3–5 years
Cons
  • ✗ Major credit impact (~7+ years)
  • ✗ Requires an attorney — talk to one before filing
  • ✗ Doesn't make the underlying debt go away on its own

Not sure which one fits?

Most homeowners don't — and that's normal. A 15-minute call is usually enough to know your best path.

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