subject: Foreclosure and Other Consequences of Not Paying Your Mortgage [print this page] Foreclosure and Other Consequences of Not Paying Your Mortgage
In the rise of the global financial crisis, many people blamed the loan mortgages that had turned bad. Lives changed drastically and for some, future has become bleak. That is why the experience had taught us a lot of lessons especially when it comes to money matters. We have learned about foreclosure and these other consequences of not settling mortgages efficiently.
Mortgaged property going gone
Buying a new home can be heavy on the budget. That is why a lot of people go for acquiring a mortgage loan from a financial institution. But since the money involved can be a great fortune, banks and other lenders usually require that the title to the property of the borrower be used as collateral. This way, should the individual fail to pay off his obligation, the bank can still save itself from losses by acquiring the title for its own name through foreclosure. So to avoid this from happening, as a borrower, you should be responsible enough to settle your debt. The house that you are purchasing will be home to your family and as you efficiently pay for your loan, you are saving your loved ones from the danger of losing a decent shelter.
Late penalties and interest charges
Upon signing your loan agreement with the financial institution, you are promising to settle your obligation at a specified date. And when you fail to pay on time, you are sure to suffer the consequence of paying late fees and interest charges as penalty. So to avoid this, be efficient enough to allocate a certain amount from your budget for the amortizations and make sure that you remit the money as scheduled. This way, you are able to save on the additional costs.
Hassles
Banks and other lending firms normally send out demand letters to borrowers who fail to meet their obligations. When this happens, not only are you put in a shameful situation but you go through a lot of hassles as well. Receiving demand letters can be alarming, not to mention irritating. But by settling your debt promptly, you can avoid this kind of situation.
Foreclosure and other consequences of not paying off your mortgage obligation can be a headache. So to keep yourself away from them, remember to be efficient enough to settle your debt.
