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Are foreclosures on the rise?All over the nation, there are homes under foreclosure. It is estimated that around 8 million homes are in the foreclosure stage. Many realtors and lending companies also see that foreclosures are higher than years before.
Why is the rate on foreclosures skyrocketing? Many people believe it is due to the housing boom. Practically anyone could purchase a home at a lower interest rate, but interest rates are higher and according to the type of loan you purchased you could be seeing this increase.
During the housing boom, most people did not look at the long term consequences on the type of mortgage loan they were applying for, they only wanted the home of their dreams. Several of these people are now in trouble today because their mortgage loan is a high-risk loan such as no down payment and interest only, plus the amount owed on the loan is greater than the home equity.
The reasons these homes go into foreclosure are as varied as each individual that purchases a home. Some of the reasons can include a drop in the real estate market, a death of the breadwinner, an illness, an accident that places the homeowner in the hospital for a long period of time. All of these reasons can put the homeowner in default on their mortgage payment. It only takes missing one payment and you are in trouble. After 90 days, the lending company will file a Notice of Default with the county clerk and then an auction on your home will be the next step.
If you know that you are going to have a hard time paying your mortgage payment on time, the best action to take is to talk with the lending company right away. Ask about special forbearance, mortgage modification, partial claim, and pre-foreclosure sale. The most important thing to let them know is that you want to make your payments and keep your home. If talking with the lending company did not do any good at all, contact HUD. This is a government agency that has several resources at hand to aid homeowners. There are agencies that may be able to help you save your home or at least your credit rating. Do not wait until the Notice of Default is filed. There are ways to stop the foreclosure and possibly save your home.
Yes, forclosures are on the rise. Be prepared and know what you must do in order to stop foreclosure and save your credit. You could always re-finance your mortgage loan, file bankruptcy, or sell your home and purchase a cheaper home. Do not let your home become one of the statistics. Get armed with the information you need prior to losing your home. There's help out there; you just have to find it.
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