What Type Of Mortgage You Should Get To Avoid Foreclosure

June 2, 2008

Unlike the last generation, there are a number of influences that can go into your mortgage payment. These different factors have contributed to some homeowners losing their property entirely. When some of these influences catch the homeowner unaware, they can translate into foreclosure and bankruptcy.

The biggest warning that financial investors give to homeowners now days is to avoid biting off more house than your financial future can swallow. After all, there is more in your future than just a mortgage payment. It’s time to plan wisely.

In the past generation, there was typically only one income supporting the bills and mortgage payment. When one spouse lost a job, the other one could quickly get a new job to help support the family. This generation, however, has built their mortgage payments on the idea of a two income family. Therefore, when one spouse loses their job, the family as a whole can quickly spiral into financial chaos and disaster. Planning for a more conservative mortgage payment at the closing can help to shield the family should a job loss happen.

How can you determine if you have too much house? Most financial advisors suggest that you make your mortgage payment no more than 28 percent of your total income. By following these rules, you are more likely to keep your home and be on time with your home payments.

In addition to keeping your home mortgage payments within 28 percent of your income, you will need to analyze the rest of your financial obligations in future years. For example, will you need to save for kids college funds? How much will you need for these financial requirements? What about your retirement? Are you building two retirement plans?

In addition, there are a number of hidden costs in home ownership. Things like home maintenance, repairs and Home Owners Association fees can add up, in addition to your usual costs like insurance and taxes. There are additional expenses that might come into play, affecting your home mortgage payment. For example, if you have an expensive hobby like traveling, you will want to free up more of your income for these expenses.

Your income or the income of your familys breadwinner can be a strong influence in how much of a house you should buy now. If you do not have a consistent income or see your income hitting a plateau or lowering in the future, this can be a significant influence for your mortgage payment.

Unlike the previous generation, the average workforce individual changes employers over the years. Through this fluctuation, income amounts can change, affecting your mortgage payments. Making your mortgage payments more conservative can help you save more money during the wealthier times and help you stay afloat during the leaner months.

If you do not have to worry about retirement or are completely debt free, rejoice. Few people fall into this category, but for those that do, the mortgage payment is a direct outcome. With less money paying the interest on credit card debts and car loans, the more money will be applied towards the home, building equity.

If you did buy a house with a large mortgage payment and are now finding that you can not afford the mortgage, maybe even needing to stop foreclosure, then contact you local home buyer. Local home buyers are professional real estate investors who buy houses from people just like you. You can get a free, no obligation offer for any house with in 24 hours. If you are thinking how can I sell my house fast, then you have nothing to loose.


How Forclosures are Affecting the Rental Market – Stop Foreclosure Fast

May 31, 2008

As more and more foreclosures are being seen in the marketplace, more and more coverage is being spent on the homeowners losing their homes. However, the analysis on the impact of foreclosures shouldnt stop with the homeowners. Foreclosures have long term effects both financial and culturally. As more and more people are losing their homes, fewer individuals are able to leave their rental apartments to invest in a home of their own.

What happens to the rental market when it is saturated with former homeowners who have lost their houses to foreclosure becuase they can not sell thier house, as well as individuals who are too timid to step out to purchase their new home. And the worst case scenario of all, what happens to renters whose landlords miscalculate and lose their property and the renters lose a place to call home.

The rise in foreclosures hasnt been beneficial for renters. Although initially, it might seem as though renters have a safe enclave from the perils of foreclosure, many renters are stuck right in the middle of the dilemma. More and more individuals, couples and families have to compete for affordable, low cost rental space as a result of the foreclosure increase.

In addition, when the property they are renting from becomes a foreclosure, the individual, couple or family finds themselves suddenly homeless through no fault of their own. The emotional impact of this sudden loss of home can be tremendous. Nearly 20 percent of all foreclosure homes are investor owned rental properties. That means that one in four foreclosures involves renters who are immediately forced to move. Many of these foreclosed rental properties are occurring in low income and minority communities, influencing neighborhoods that are already dealing with economically vulnerable individuals and families.

The number of renters has increased drastically over the last year. Renters are up by nearly 1 million, which is more than four times more than the growth rate between 2003 and 2006. The demand for affordable, low cost housing has significantly increased, but the supply of these low rent homes is decreasing.

Currently, studies are showing that nearly half of all rental families are contributing 30 percent of their income to their housing, while one in every four families were putting 50 percent or more of their income towards their rent and associated costs. The economic impact of these families spending the majority of their incomes on rent cannot be underestimated. If these families were living in low cost, more affordable housing, the stability and overall economic stimulus would improve.

However, the renting landscape is not thoroughly grim. Due to a weak housing sales market, more and more homes, condos and units are being put on the market as rental properties instead of sales. While the debate still exists as to whether these rental properties offer the low cost housing options that are needed on the market, the availability of more and more rental properties assumes that the situation will be alleviated to a degree. No matter what, however, the foreclosure increase is showing an impact for renters as well as homeowners alike.

If you are an investor and own a home that you are going to loose to foreclosure you have options. There are ways you can stop foreclosure fast and save the little equity you have in your investment. To sell your house and receive a free offer for your investment property, contact your local home buyer. They exist in every major metro area and you can sell your house fast.