When you buy a home, you don’t think of losing it unless when selling it – but lenders taking and selling it may be the last thing on your mind. However, foreclosure can happen to anyone, even those who have thoroughly planned for their mortgage payments. While this may seem worrying, being informed can help you make the right moves. And the best place to start obtaining information is the root.
Here are three causes of foreclosure:
Job loss/reduction in income
If you lose your job or your income is reduced, you may have difficulties paying your mortgage. You may manage for a few months, but this can become challenging as time goes by, especially when you start using your savings to pay the mortgage.
You need your savings to meet your needs before you get another job. Thus, spending it on your mortgage may be risky. After some time, you may miss payments and can receive the letter of intent to foreclose from your lender.
Credit card payment
Credit card debt can be overwhelming. In addition to having a high debt, endless calls from debt collectors can stress you. As a response, you may find yourself contemplating missing mortgage card payments to pay credit card debt for your peace of mind. If you do this, your home may be foreclosed.
Medical expenses
Unfortunately, medical expenses can be high, and some may not be covered by insurance. Thus, you may need to go into your pocket to pay them. Medical bills have led people to declare bankruptcy, which shows how serious they are and, in turn, can cause foreclosure.
If you receive a foreclosure notice, it may be best to get legal help to know the best ways to defend your home.