Foreclosure should be something that none of us have to go through. It is an awful process, whereby your home is stripped away from you – as a result of your failure to pay debts on time. Foreclosure usually occurs when your mortgage falls in to arrears, and you are no longer able to keep the payments up to date.
If you are significantly behind, the bank will give you a number of chances to pay up. If this is not possible – the end result unfortunately is foreclosure. This is simply a necessary step in the debt reduction process, as if you are not able to afford the repayments, you probably shouldn’t have that debt in the first place.
However, in saying that, there are a number of things you can do to prevent foreclosure. If you are clever and analyse your own financial situation well in advance – you will be able to prepare for such an issue if it arises.
Let’s take a look at a few ideas to ensure you steer clear of foreclosure if you have a mortgage.
Manage Your Money
Money management is not taught in schools these days – for a reason. It is difficult, time consuming, and probably a bit too much for some people to get a grip of. When we talk about money management, we don’t necessarily mean that you need to sit down for hours on end and rule up a budget to control every cent you earn. In fact – we advise against this. Instead – using the services of a professional money management and debt control company is advisable.
By associating with one of these companies – you will be able to achieve the following things which you might not have been able to do on your own:
- Consolidate your debts.
- Renegotiate your debts.
- Get a better interest deal on your debts.
- Ensure that you have advice tailored to your situation.
There are two companies that we recommend to fulfil all of the tasks listed above. The first is a company called CuraDebt. They have been around since 1996 – and they know the market inside and out.
This company is best for people who have total debt of between $2,500 and $10,000. Basically, they will be able to solve anything to do with these small loans – and will certainly be able to advise you on how to avoid foreclosure due to small debts mounting up.
Another company is called Care One Credit. This company caters to people with larger loans – such as those with $10,000 or more. The services offered are comprehensive, and the advisers are extremely knowledgeable.
Reduce High Interest Debts
Having outstanding high interest debt is one of the worst things you can do for your financial future. Essentially – this is like a dagger through the heart when left to accumulate over time. If you currently have credit cards which you cannot afford to pay off in full, you are not only risking default on the credit card itself, but potentially also foreclosure if your loan is too big. Also – repayments of interest in the future could have been used to pay off the debt in the first place – so it really is a vicious cycle.
Our advice would be to discuss debt consolidation packages with the providers listed, so that you can settle for a more achievable interest rate on these outstanding balances. Hopefully, if done soon enough, you will be able to completely avoid a default and ultimately a foreclosure on your home.