The very first thing you have to do to stop foreclosure is sit down and consider whether you can actually afford to keep your home.
You have to be able to make your mortgage payments. If you agree to a lender\'s \"workout\" solution, or are able to get a new loan and stop your foreclosure, great!
But if you fail to make the agreed-upon payments, you\'ll be right back into foreclosure.
This can be a big problem if the financial crisis that caused you to fall behind isn\'t over. Be realistic. Many times people struggle to hang on to a house that they simply can\'t afford. That may seem harsh, but sometimes it is the truth.
Many times home owners have been downsized, or lost their job entirely. They’ve found a new one, but their new job pays them half of what they were making before. If your home payment is $2500 per month, and you are now bringing in $2000 per month, you simply can no longer afford to keep your home.
So what do you do to see if you can still afford to keep your home? Take out a blank sheet of paper.
On the left side, put down all of your income. Everything.
Include salary, wages, pension, Social Security, second jobs, disability… anything that contributes to your monthly income.
On the right side, make a list of all of your expenses. Again, include everything you pay on a monthly basis. Credit card payments, car payments, house payments, phone (include cell), utilities, cable, gas/commuting expenses, any medical or recurring prescriptions, student loans, food, clothing, work related expenses, child care, everything.
Not only will it give you an idea of exactly where your money goes, but it may also surprise you.
When you actually break down your income and expense information, you’ll find some areas that you can cut back on; especially with less than critical monthly expenses.
If it’s the difference between saving your home or spending $200 per month on your cell phone bill, I think the choice is pretty clear.
Do not skip this first step. You will need to have an idea of exactly where you stand from an income and expense standpoint to determine if you can actually keep your home.
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