A short sale can significantly damage your credit and remains on your report for years. The forgiven debt may be treated as taxable income depending on your circumstances. Credit impact is generally considered less severe than foreclosure, though the exact effect depends on your full credit profile. Work with a tax professional and credit advisor to understand the specific consequences for your situation.
From the seller playbook: Short Sale and Distressed Sale Procedures in New York
This is general information, not legal, tax or accounting advice. Every situation is different. Talk to a licensed attorney, accountant or tax professional before you act.
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