Wednesday, November 24, 2010
Common Reasons for Foreclosure
The main reason why there is foreclosure is because the homeowner was not able to update the monthly mortgage payment to a lender. Obviously, during this stage, financial struggle is very evident. You won’t miss a single month for a mortgage if you are financially capable, unless otherwise you were not able to work on it which is most of the time will not happen. The truth behind lags in paying monthly mortgage is the financial difficulty. That is why it is important that each homeowner should have the idea about the cases that may result to foreclosure so they can be able to prepare ahead of time.
There are a lot of reasons to be considered but these are just the obvious reasons that everybody should be wary of:
1. Health Problems
According to the old cliché, health is wealth. It’s true. No matter how wealthy you are if your health is compromised, your money will become nonsense. It is either you can’t enjoy using it because of your health condition or your money will all go to your medication. If health is affected, it will tend to pull you down economically and may make you unable to update your monthly mortgage.
2. Dynamic Real Estate Market
There are things that we can’t control. Real Estate Market is dynamic and we don’t know when the changes will take place. Because of this, you will come to the point that you can no longer sell your house to save it from foreclosure.
3. Death in the Family
Loosing somebody in the family may directly or indirectly affect your finances. Some people may not be able to keep their home after a family member died.
4. Lose of Job
This is I think the most obvious and the most common reason. The job is the bread and butter of most families and this is where they entrust their payments for mortgage, debts and other expenses. If they will lose their job, then that’s the big problem.
5. High Mortgage Payment
You will maybe come to a point where you can’t control your mortgage payment anymore. It is either because it is too high or it just increased without prior notice.
6. Bills, bills and bills
As long as you live in a house with your family, you are not exempted of paying bills. Electric bills, water bills and telephone bills. So instead of paying monthly mortgage, you can’t be able to do it anymore because of high bills. Some people may not be able to keep their house because of this.
The reasons mentioned above are just common day to day problems to most houses. If you will not prepare for this, you can’t avoid foreclosure to come and take your home. You must be careful when you are at the situation mentioned above. During this stage, you must have a generic plan on how to overcome it. The best way to defeat enemies is to know when it will attack.