Foreclosure Pros And Cons

How Will Foreclosure Affect Your Life?

Foreclosure can devastate your credit score, ruin your finances, and, most importantly, leave you without a roof over your head. However, in some cases foreclosure may be the best option for you, your family, and your finances.

In the wake of a foreclosure, families often struggle with the following consequences:

• Loss of housing. Foreclosure is, first and foremost, the loss of your family’s home and shelter. Finding a new home or apartment may prove difficult considering that a recent foreclosure in your past may deter landlords and property rental agencies, and considering that many families who have recently experience foreclosure often do not have the money for a rental deposit. Buying a new home will not be an option for at least five years, though most families will eventually own a home in the future.
• Loss of investment. When you lose your home, you also lose all of the money that has been invested in it. For many, their home is their greatest asset, and those who have been in their home for many years stand to lose tens of thousands or even hundreds of thousands of dollars in equity if their home enters foreclosure.
• Ongoing credit problems. Once you default on your mortgage, your credit will be harmed – and often those facing foreclosure are already suffering from other financial issues that also affect their credit score and credit history. A foreclosure can remain on your credit report for several years, but smart spending, budgeting, and the wise use of credit can slowly lower interest rates and rebuild your credit.
• Emotional trauma. Even though many foreclosures could not have been avoided, many of those faced with foreclosure experience depression, anxiety, shame, and feelings of hopelessness. Foreclosure can also put a strain on marriages and affect the mental health of any children involved. According to CompPsych, a firm that counsels troubled homeowners, foreclosure and foreclosure fears can lead to insomnia, increased domestic violence, addictive behaviors, and even suicide.

• If you are in the process of Foreclosure or maybe facing Foreclosure soon, Consult Your Case for Free with a local certified Foreclosure Attorney to see which legal options you have available.

When Is Letting Go Of The House The Best Choice?

Although no one wants to lose their home, sometimes letting go of your property is the best option, even in light of the serious consequences mentioned above. If you know that you can’t afford to make your mortgage payments consistently into the future, it may be time to cut your losses and walk away from your home.

Here are some circumstances that may make leaving your property the better choice:

• You have very little equity in your home.
• You are not able to modify or restructure your loans.
• You are not able to keep up with other bills.
• You are spending your savings on keeping up on your mortgage, such as your retirement savings, your children’s college funds, or your emergency funds.
• You are facing bankruptcy.
• You owe the IRS back taxes.
• You are also struggling with a larger, more serious financial problem, such as a medical emergency, death in the family, job loss, or divorce.
• You are facing foreclosure on a property other than your primary residence.
• You are struggling with serious depression, anxiety, or thoughts of suicide.
• You have talked to a financial counselor and a foreclosure lawyer about other possible options.

                                                                                           Continued: Foreclosure Timeline -->