Getting Through Tough Financial Times
Common Reasons for Foreclosure
Job Loss
Job loss is a frequent cause of home foreclosure. The economy strengthens and weakens, and in conjunction with that the workforce moves up and down in numbers. As the unemployment rate goes up in a city it is safe to assume that foreclosure numbers will raise as well. Again, ideally one might hope to have saved enough money over the years to cover the home loan, credit card bills, electricity, or other bills in the case of job loss. However, this is not a social reality. The many Americans who have suffered job loss cannot pay monthly dues. They result with a default home loan, fall into debt, and in many cases are foreclosed on by their mortgage lender.
Death
Death is single handedly the most damaging event for a person or family. Death can, in many ways, cause a family to lose everything including their home to foreclosure. Take for instance, if the sole provider of the mortgage payments has died, then it is very likely that the rest of that family will lose their home in foreclosure. Unfortunately, the other spouse may be disabled or unable to work and sadly that person is in a seemingly out of control situation. This is where a qualified housing counselor specializing in foreclosure will step in and help him/her get control again.
Conclusion
The reason a person or family goes into foreclosure is important for all to understand. As a homeowner, one can be prepared for such a situation as the aforementioned, and as an investor, one can be informed as to what causes foreclosure and how to be of service. Death, job loss, medical expenses, and divorce are a few of the most common reasons people foreclose on a home. These factors are real and an everyday part of society.
Source: Adapted from the National Association of Foreclosure Prevention Professionals