How to Avoid Foreclosure, Part 1

Have you fallen behind on your mortgage payments? Do you stare at the ceiling at night, wondering if tomorrow will be the day your mortgage lender throws in the towel and decides to foreclose on your home? Do you spend your waking moments terrified of the prospect of relocating your family, or — worse yet — becoming homeless?

You’re far from alone. According to the FDIC, one out of every 200 homes in the United States will eventually be foreclosed upon. More than 83,000 families enter into foreclosure each month! And one child in every classroom in America is at risk of losing his or her home.

Scary stuff, indeed. And, having fallen behind on my own mortgage payments, I know how all-consuming the stress is. I spent every single moment worrying about whether my wife would leave me, or whether I’d have to take my child out of her fantastic school and put her in some inner-city public school where no one gives a damn about anything but shoving kids through the system.

If you’re anything like me, worrying about foreclosure has taken a toll on your health as well. I started skipping meals to save a few bucks, and to devote more time to making money. My back and stomach constantly hurt from the stress, and my mind was never clear because I couldn’t sleep worth a damn.

The main reason for the prevalence of foreclosures, of course, is that mortgage lenders encourage us to buy a bigger house than we can reasonably afford. I’m not blaming the mortgage industry, mind you. That would be like a person blaming a drug dealer for his meth addiction. But the fact that people buy into the dream of owning an expensive home on a moderate income usually gets them into trouble later on.

Thing is, once you’ve committed to that mortgage, you can’t go back and change it. All you can do is determine how to implement damage control and keep foreclosure from occurring. Beating yourself up for what you can’t change isn’t going to do anyone any good.

Which brings me to the second main reason foreclosures occur: People don’t know what options are available to correct the problem before it becomes irreparable.

That part, we can fix. In fact, that’s just what I’ll be doing over the course of the next several posts.

In the meantime, take a deep breath and trust me when I say that there are almost always options available to avoid foreclosure.

Stay tuned,

Mike

Image: Niall Kennedy via Flikr