What To Do After a Foreclosure
Owning your own home is not always an easy endeavor on average occasion, keeping up with mortgage payments, fixing things when they break, caring for yard work, landscaping, driveway and roofing repairs and more. But, in this day of financial down-turn, foreclosures are at record highs and if it happens to you, it can be a life-altering situation. Unfortunately, once a foreclosure is final, the financial and emotional upheaval is far from over. So, what happens next?
While there’s considerable pain, most foreclosure victims will eventually become homeowners again, according to past statistics. Still, that won’t happen anytime soon, especially since mortgage rule maker Fannie Mae has recently lengthened the time that must lapse between a foreclosure and approval for a new mortgage. Here’s a look at the issues foreclosed families grapple with, and some smart solutions.
- Finding a new home
- Suffering the credit fallout
- Buying another home
- Owing an employer an explanation
- Getting hit with a tax bill
- Living through loss
The immediate problem is obvious: where and how to find a new place to live. Lack of cash for a rental deposit is probably the biggest barrier to foreclosed owners getting re-established on their own. Landlords will sometimes accept tenants who have a credit score of just 580, but if landlords look beyond a numerical score to credit records, a foreclosure may spook them, since it indicates the potential tenant hasn’t paid his housing bills. If the foreclosure can be explained, however, and if the rental candidate has a solid job history, he may be accepted.
If you’re on the edge, you may have to double your deposit and scraping together a rental deposit isn’t easy for cash-strapped foreclosed owners. This is why it is important you try to make plans as soon as you think foreclosure is inevitable. Anyone who has a FHA-insured loan who’s being foreclosed on should investigate the “cash for keys” program, whereby they get a check for up to $1,000 if they voluntarily vacate and leave their home “broom clean.”
Though it might seem hopeless, there is help for those who face foreclosure. The government is beginning to recognize the depth of the situation and new methods to get you back on your feet are becoming available. Keep your eyes open, ask friends and family to help. This is not a time to be alone.
Related posts:
