You thought you would live in your home forever, yet life has other plans and you unfortunately have to move. Most of us probably know someone in this situation – and it’s never painless. For one reason or another, selling a home can be downright stressful; selling a home because you’re drowning in debt adds an even more stressful dynamic.

What can you do? Is it possible to sell your home as soon as possible while avoiding a less-than-stellar credit report? It turns out there are certain best practices you can do to make the blow of a short sale sting less than it normally would. Below are a few of our best tips.

Ensure you can handle the impact of a short sale.

A short sale will lower your credit score significantly – in some cases, over 100-points. Even so, if you cannot afford your home and need to sell it yet the home has depreciated in value, committing to a short sale will not impact your credit score as harshly as a foreclosure. It’s the smart decision when paying for a mortgage simply doesn’t make sense. Speak to a financial adviser and determine if a short sale makes the most sense in your situation and what you can do to further minimize the blow to your credit report.

Handing Over Cash For House Keys And Short Sale Sign

Bad credit? Fix it.

While it’s easier said than done (much, much easier in fact), repairing your bad credit before making the call to a realtor is mandatory. Look at your credit report and note any black marks such as a foreclosure, late payments, etc. that have occurred in the last seven years. While these marks cannot be removed before the seven-year window has closed, it will give you a good idea regarding how you can fix your credit score.

Get creative when figuring out how to eliminate bad credit. For example, look through a recent credit report and dispute any data that looks like it cannot be verified, is outdated, or simply doesn’t make any sense (i.e. if you can’t recognize the debt), dispute it. Moreover, consider swapping bad debt with good debt by applying for installment loans that will let you pay your debt in installments. It’s like any other type of debt you have to pay monthly, only that it will wipe away old, bad debt for new debt; your score will improve within 1-2 months.

Bad credit pay off credit card debt

Pay off any credit card debts if applicable.

Payments constitute for 30% of your credit card debt. Thus, getting serious about paying off the bulk of your credit card debt is one of the best ways to ensure your credit score stays healthy away a short sale. While you may not be in the position to eliminate a lot of your debt since you’re considering a short sale in the first place, every bit helps. Keep an eye on your credit score by utilizing free credit monitoring services as you pay off your credit card debt, and notice how much your score is being improved with every payment.

Offset your mortgage payments to pay other debts.

Where are you going after selling your home? If you are moving to a home that is significantly less than your mortgage payments, create a budget that lets you offset your payment schedule to knock out your other debts. Because a short sale will significantly lower your credit score in the beginning, getting off to a solid, strong start by eliminating any outstanding debt is the best way to bounce back from the impact.

We won’t sugarcoat it: a short sale is going to hurt your credit score. Yet, by abiding by these best practices you will find that they will offset the hurt your credit score is going to be feeling for a while. Follow these tips, and your credit score may stay fairly healthy during the seven years the short sale stays on your credit report. Use those few years to really stay on top of your credit score and continue to keep improving it. By doing so, you will come out of the other end of the tunnel with a credit score nobody will scoff at!