University of Illinois Extension

Common Reasons for Foreclosure

Learn some of the most common circumstances that can result in foreclosure.

Common Reasons

If a family loses a home to in foreclosure, it is easy to speculate that they were irresponsible with loan payments or they bought out of their league. The truth is told that there are many reasons people foreclose on a home. Sometimes it is out of their control. When a family forecloses on a home, there is always hope and someone to help. There are other factors that may cause a family to suffer from one of the many life changing events, such as:


Divorce is a life changing issue. When there is a split in a household, this can cause people to lose their home in foreclosure. Divorce is definitely a reality of our society today. Depending on who keeps the house is the determining factor of who will take over the monthly payments of the house. The cost of a divorce itself can be the main cause of losing a home in foreclosure. Poor communication in a divorce is a factor which leads to unintended neglect and defaulted payments as well. There are many different divorce scenarios that lead to home foreclosure.

Medical Reasons

Unexpected illnesses lead to a surplus of uninvited bills. Many people can't afford these expenses or do not have the insurance coverage to save them. Nobody plans to foreclose on their home, just like they do not expect to pay thousands of dollars in hospital bills. Ideally saving money out of each paycheck to cover potential medical expenses would be great, but that is not always an option. Many Americans live paycheck to paycheck, barely making the home loan payment. When a medical emergency happens within a family, the monthly mortgage payment is put on the back burner. Reason being that an illness can cause emotional stress, or disable someone from working (which leads to the next topic...)

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