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Real Estate Foreclosure – The Ugly Truth

Real estate foreclosure can be a real nightmare. If you own a home, then it is probably your pride and joy. It is often seen as the ultimate thing – to own and live in your own home the American Dream! Many people spend years scrimping and saving and going without luxuries in order to be able to afford the deposit on their own home. Then, they get a large mortgage and pay it back dutifully, hoping that if all goes to plan they will own the home outright in a couple of decades. However, things do not always go to plan. Unfortunately, life has a way of throwing unforeseen circumstances at us every day and sometimes these circumstances can have some terrible consequences.

Real Estate Foreclosure

If you have bought a home and for some reason you are unable to make the repayments all of a sudden, what happens then? You might have a few weeks to be able to get the money together before any trouble starts, but if you still cannot pay back what you owe, your lender will probably start proceedings to take it back for themselves. This is when you will start to hear the word “foreclosure”. Unfortunately, this is one of the scariest things that can happen to a home owner. If you find yourself being put through real estate foreclosure, what this means is that your lender will seize your property and sell it off to recover their money. So, not only will you be out of your home, but all the repayments that you have made up until that point will be for nothing. Also, this sort of situation might stop you from being able to get another loan for quite a few years.

What Can You Do About It?

If you find yourself in a situation in which you cannot pay your mortgage, then you will need to try to solve this as quickly as possible. Foreclosure should only be something that happens to you if you have exhausted all other avenues and you just have nothing left to try. The first thing you can try is to put off all of your other bills. Having your phone or electricity cut off is bad, but it is not as terrible as losing your house to real estate foreclosure! This is not to suggest that you do not pay these bills, just prioritize so that your mortgage comes first over everything for the time being. Look at ways in which you can save money in other areas. Cut back on food costs as much as possible, such as by shopping at discount supermarkets or by using coupons to save on items that you regularly buy. At this time you should not be spending any money on luxuries such as clothes or going out.

What If You Have No Money Coming In?

If you have lost your job or for some reason have no money coming in to your household, then budgeting will probably not be enough. If you have tried everything else, then you might have to look at taking out another loan. Normally this is not the best way to go, and taking out one debt to pay off another can often lead to trouble, but if it means the difference between keeping your home and losing it to real estate foreclosure, then it is a better path. If you can borrow of family or friends easily then you should swallow your pride and try this, because this type of loan is not going to attract interest (hopefully!) and someone you know might be more open to letting you defer payments until you get back on your feet.

Consolidation Loans to Stop Foreclosure

If this is not an option for you, you can try applying for a consolidation loan. This sort of loan is made to people who have debt to pay off, and allows them to pay back the amount of this debt and be left with only one payment to make. Consolidation loans do attract a high interest rate, but they will give you more time in which to come up with money for your debts. Whatever path you choose to take, you need to work as hard as possible in order to stop real estate foreclosure. This is something that can be catastrophic in your life, and you definitely do not want it happening to you. If you are savvy, you will hopefully be able to work out a way to get more cash in, or to spend less. As we have said, do whatever you can to make sure your home does not go into foreclosure as it can be very hard to come back from and you do not want to end up out on the street.