How does a foreclosure affect a credit score versus a short sale?

When it comes to short sales, a status of “account paid in full for less than full balance” or “settled” will still have a negative impact on a credit score because it means the debt was not paid in full as agreed. According to VantageScore Solutions LLC, a mortgage loan settled through a short sale typically results in a change of 120 to 130 points to the VantageScore credit score. A foreclosure generally causes a decline of 130 to 140 points. The impact of the short sale or foreclosure will vary since scores take into account the individual’s overall credit history.

VantageScore® is owned by VantageScore Solutions, LLC.

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Source: The Ask Experian team advice blog.