Having a mortgage is quite scary these days. This is true even if your mortgage
You don’t want to default payment that could lead to losing your home. Prevent this scenario by looking at some strategies.
- Have a backup fund. This is a good help in case you have financial problem. There is no universal rule on how much the amount is but expert’s advice should be three to six months expense. Make this fund hard to access so it will not be tempting to use. If you have huge debt, this can be handy in case of emergency.
- Apply for a mortgage that fits your finances. You can encounter brokers that will push more than you can afford. Sometimes it is ideal to opt for lesser. You might want to buy as home lesser than your means so that you can keep up with payments especially when cash is tight. In case you have extra then pay more.
- Consider refinancing your mortgage. This can surely lessen monthly payments and other fees. You can start the process now and use your savings as an emergency fund.
- Look into job loss mortgage insurance. This is available in several sources like banks, insurers and homebuilders. Take note that there is a time gap on the payout. The insurance only covers minimum payments to prevent foreclosure.
- Find out the policy against late payments. There are some lenders with policy for late payments. Set an appointment for waiving late fees or they can delay the reporting to credit bureaus. You might want to warn the lender about current finances.
The best defense is to be responsible with your finances. Keep track your habits when it comes to money. You might want to plan ahead of time.