House Foreclosure. Saving Money While in Foreclosure
One of the most important but often over looked aspects of going through a house foreclosure is a person’s finances. Unfortunately, a majority of people view the money they are not spending for their mortgage as a windfall. As found money. This is the wrong way to look at it. While you do not have a mortgage payment during your house foreclosure battle, it is a good time to potentially turn your financial situation around. It is a good time to put some money in the bank.
Unfortunately, most people look at this as a time to splurge. Nice dinners. Movies. New clothes. Believe it or not, many people go out and buy another car. No, No, No! Save your money. Put it away for future use. You might need it to work out an arrangement with your lender. For one thing, saving your home from a house foreclosure is not free. You will have legal fees. You might need to come up with a lump sum payment to your lender. It might seem like common sense, but in most cases it apparently is not. I have seen it over and over, people living the high life while they are in the process of being foreclosed on. We here at the Chris Mudd & Associates PLLC are very good at what we do but we need your cooperation. The one thing we do ask of you is that you are smart with your money.
That means saving as much as you can during this stressful time of House Foreclosure. Does that mean never going out to eat or never going to a movie? Absolutely not. Everybody needs a little entertainment sometimes. It just means being frugal. Being smart. If you have a $1000 house payment and you are still working, then you should be able to pay your legal fees and put a portion in the bank, in case you need it. There may be some months when it is difficult or maybe even impossible to put some money in the bank but you should be able to do it on a regular basis. You might also consider paying down or paying off some of your other bills. Look at this as an opportunity to turn your finances around. House foreclosure is not the end of the world. In fact, it could be a chance to improve your life and finances permanently.
You want to be prepared in case the lender makes a settlement offer to you or wants to modify your loan. Some times the lender will require you to make a lump sum payment. So, be prepared.