Foreclosure: A homeowner who loses a home to foreclosure is not eligible for a Fannie Mae backed mortgage again for a period of 5 years A foreclosure will lower a homeowners credit score between 250 to 300 points. A Foreclosure will remain a public record and affect a person’s credit score for up to 10 years Short Sale: A Homeowner who successfully completes a short sale is eligible for a Fannie Mae backed loan after only 2 years Only late mortgage payments will show on a homeowners credit report and after a short sale, the loan will show “paid” or “negotiated”. This will lower a credit score by as little as 50 points if all other payments are being made. The affects can be as brief as 12 to 18 months. Sources: Distressed Property Institute LLC Foreclosure vs. Short Sale