THE EFFECTS OF FORECLOSURE

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The great states of Louisiana and Texas both agree, the best way to handle foreclosure is like ripping off a Band-Aid - fast! Unfortunately, the pain of foreclosure is much longer lived than the adhesive strips of a Band-Aid being removed from your skin. But how bad can being foreclosed on really be? Let’s look at the 5 biggest problems that you likely face if you go into foreclosure.

1.   FINDING A NEW PLACE TO LIVE – This is going to be your first hurdle. Very quickly after your house sells at auction, you will be evicted and in need of a new place to stay. This can be a problem on several levels – not only will you need to have enough money to put down for your deposit and first months rent, but a majority of landlords also require application fees and will do a credit check. With a foreclosure on your record your credit score is going to be low and this is likely to discourage landlords from renting to you.

2.   LOW CREDIT SCORE – Having a foreclosure on your credit report will most certainly destroy your credit score, and negatively impact it for the next SEVEN years! Things such as renting or applying for a loan (to buy a new car or pay for unexpected expenses) are going to be extremely difficult – if not impossible. Credit card companies are also going to charge you ridiculously high interest rates because of your low credit score.

3.   DIFFICULTY BUYING A NEW HOME – Traditional mortgages are going to be out of your reach until your credit is repaired – which won’t be for the next seven years. Even Fannie Mae is withholding loaning to victims of foreclosure until after seven years. There is a possibility that you may be approved for an FHA loan after 3 years but you’ll have to prove that you’ve been able to pay your bills well since your foreclosure and there is still no guarantee.

4.   PROBLEMS GAINING EMPLOYMENT – Having a foreclosure on your credit record could even affect your ability to land a job. It is becoming more and more common for potential employers to run credit checks on candidates. This is especially true if you will be handling money at all – cashiers, auditors, accountants. Be prepared to have to explain a foreclosure to your interviewer as is may come up.

5.   EMOTIONAL/PSYCHOLOGICAL CONSEQUENCES – After dealing with the four previously mentioned problems, your mental health is likely taking pretty good hit too. People who have endured foreclosure report feelings of depression and anxiety. It feels like coming back from a foreclosure is an impossible feat, and that they are a failure. A house is more than a house – it’s a home. To lose it, is devastating.

We want to help people avoid these problems as much as possible. We’ve seen hundreds of foreclosure situations and not one of them is ever exactly the same. No matter what lead you to the brink of foreclosure, we specialize in helping find solutions. Some of the strategies we employ to help people out of foreclosure can also have positive impacts on your credit long-term. In a lot of cases we are able to help with relocation services. The biggest mistake you can make, is waiting too long to reach out for help.

Let us be your Real Estate SOULution and contact us today!

For Louisiana: www.ibuylouisianahomes.com 225-800-4445

For Texas: www.yoursouldtexas.com/houston 832-956-0444

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