If you receive a foreclosure notice, your stomach will sink and your head will begin to spin. This is a natural reaction, as you know your lender is closing in on repossessing your home.
Fortunately, even if you receive a foreclosure notice, it doesn't mean that you will lose your home. There are still steps you can take to save it.
Before you run into this problem, it's best to understand the most common causes of foreclosure. Consider the following:
- Rising interest rate: If you have a variable interest rate mortgage, a rising rate will result in a rising payment. Subsequently, you may not be able to make your payments in full and on time.
- Job loss: You know you can comfortably afford your mortgage payment when you have a job. You also know that this is impossible if you are out of work.
- Death: If a family member passes on, such as a spouse who was the primary bread winner, you may find it difficult to keep up with mortgage payments.
- Illness: An illness can turn your life upside down in many ways. For example, it may keep you from working, thus making it more difficult to earn money to pay your bills.
Knowing the things that often lead to foreclosure will allow you to avoid trouble in your life.
If you've tried everything and are unable to stop the foreclosure process, don't forget to learn more about bankruptcy. Filing for bankruptcy will stop foreclosure for the time being, buying you enough time to figure things out and get your life back on track.