Financial problems can easily put a homeowner’s biggest asset in danger if they fall behind on their mortgage. A foreclosure can happen to anyone, even you, if you do not know what causes foreclosure.
Here are several reasons you could find yourself facing a foreclosure on your home:
Increasing interest rates
A low-interest rate may have seduced you into going all-in on your home. Depending on your loan type. you may find out later that these interest rates rise unexpectedly. That can make it hard to make payments. Missing several payments in a row can cause higher and higher debt until your bank or mortgage loaner has no choice but to foreclose.
You may find yourself unexpectedly unemployed and without a way to make payments on your house. If you do not have strong savings then it can be hard to keep up with your payments until you find a job again.
Unpaid credit card debt
When creditors are hounding you, it can be hard to choose between paying your mortgage or paying your credit card bills. The wrong move can easily leave you behind on your mortgage.
You may come to find that you are solely responsible for paying off your house payments after a divorce. This can be stressful on your wallet especially if you are suddenly paying for car or credit card payments. You might even forget about the house payments because of stress during the divorcing process.
It can be scary to think you could lose your home to foreclosure. Filing for Chapter 7 bankruptcy or a Chapter 13 bankruptcy could push the foreclosure back and give you a chance to catch up on your payments — or make other plans. Experienced legal guidance can help you decide what’s right for your situation and show you how to regain control over your life.