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Should you let your house go due to bad finance & foreclosure?

Should you let your house go due to bad finance & foreclosure?

When a homeowner receives his foreclosure notice, there are two common reactions. The first is one of shock, anger and panic. One’s home holds tremendous sentimental value to every homeowner, and it can be especially difficult when there are children in the family.

Then a second reaction sets in. As the possibility of foreclosure becomes more real, many people come to overcome their panic and start weighing their options. The most important question that anyone in this position is bound to ask themselves is, “Is it time to let the house go”? The answer to this question will determine the options that one must take in responding to the foreclosure notice.

Your Finance Determines This

Should you stand your ground and exhaust all avenues to keep your house, from requesting a loan modification to fighting your way through court proceedings? It all boils down to whether or not you still have the means to finance your mortgage and the maintenance of your house. Even if the bank agrees to a loan modification, is your finance situation stable enough to make things work?

If your finance situation looks bleak, and you can no longer afford to pay your mortgage even after loan restructuring, then you may need to seriously consider letting your house go. Your goal, at that point, will no longer be to keep your house but to cut your losses. You can still avoid a foreclosure record by exploring options such as a short sale or a deed in lieu. By availing of these options, you’ll be able to minimize the impact on your credit standing and will stand a better chance of getting your personal finance situation back on track.

Deciding whether or not to let your house go is not only limited to considering whether you can still finance your mortgage. You’ll also need to consider the amount of costs involved to finance the maintenance of your home. You also need to factor in other important items that you need to finance at the present and in the future, such as your son’s college education and  your family’s health plan.

Assess Your Situation & Get Back on Track

Some people never get to the second phase or state of emotions. There have been homeowners who struggled through a foreclosure proceeding purely driven by their anger and shock that they ended up losing not only their home but also any chance of getting their finance situation back on track. Don’t let that happen to you. Make it a point to sit down, then calmly and honestly assess your situation and your capacity to finance your home. Doing so will save you from wasting time, money and effort on inappropriate solutions to your foreclosure problem.