Having property foreclosed on is nothing anyone wants. Aside from the emotional strain and disruption, this can cause your family and close friends, a foreclosure on your credit report can also destroy your finances. This will have a ripple effect on your entire life that will be with you well into the future. It will affect everything, from where you’ll live and work to the car you’ll drive as well as the clothes on your back.
Louisiana Direct Home Buyers has years of experience helping people in this exact situation. We are available to speak with you and answer whatever questions you have about the circumstances you find yourself in. If you would like to know how we can help you avoid the devastating effects of foreclosure, please call (504) 224-9066.
A fuller understanding of what you could be facing will better prepare you to immediately take the necessary steps to avoid the dire results of a foreclosure.
You will look back in gratitude for taking whatever time you needed to figure out your options ahead of time. This article will explain 4 different ways that foreclosure in New Orleans can impact your life.
How a Foreclosure in New Orleans Can Impact Your Life
Denial of Credit
When your credit report shows that you have been foreclosed on in New Orleans, anyone checking your credit will automatically label you a “bad risk.” This will have a detrimental effect on your buying power. When you apply for a car loan, home mortgage, or even credit cards, you will likely be denied. Any lender who approves applicants with poor credit typically charges huge fees and interest rates. Furthermore, prospective employers may not hire you because of your credit history.
Loss of Home Equity
One of the main reasons to buy a home is to build up equity. Equity is what your property would sell for minus what you still owe on the mortgage. The plan is to pay down the mortgage while the value of your property in New Orleans goes up. As the equity increases, your financial gains could reach hundreds of thousands of dollars in New Orleans. Having the property foreclosed on will definitely affect the equity, whether in part or in full. In many cases, this would represent an enormous financial loss.
May Owe Deficiency Debt
If your lender sells your foreclosed New Orleans home for less than the amount you still owe on the mortgage, you will have to continue making payments until the debt is paid. This is called a “deficiency debt” and it will hugely affect your lifestyle moving forward. Aside from ruining your budget, this debt on your credit report will add to the many consequences of having poor credit.
On the other hand, you could act immediately to resolve your pending foreclosure. This would include making wise decisions on selling your home and the price it’s sold for. Make sure all mail you receive is opened and read before the clock runs out! Keep talking to your lender, so that you are in the know about what actions are being planned. You need to know how much time there is to change the course of events to your advantage. Once you’re foreclosed on, your options disappear.
Fewer Options for Housing
A foreclosure will not only affect your current living situation it will have an indelible impact on your future housing prospects as well. Landlords typically run a credit check on all prospective tenants. Once they see a foreclosure on your credit report, you will be deemed risky. This will likely mean a denied application in the areas where you may most want to live.
Furthermore, should you be in a position to buy another home, your options for financing will be quite limited. Fannie Mae is one of the largest lenders in the U.S., offering loans with a number of financial benefits for borrowers. However, Fannie Mae requires applicants with a foreclosure on their credit report to wait 7 years before they can become eligible for a mortgage through them.
Being under threat of foreclosure in New Orleans is enough to cause many sleepless nights, but if you don’t take control of the situation you are risking your financial future. Do what you can now before it’s too late by allowing Louisiana Direct Home Buyers to help you get out from under this. You can email us or call (504) 224-9066 today for the help you need.
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Foreclosure can affect your life in so many ways. In this blog we outline just several.
Nobody wants a foreclosure on their record. We talk daily with people in trouble with their mortgage. They have fallen behind on their payment and start dreading the inevitable. Many times they slow down and stop making decisions. We tell each person we deal with facing foreclosure that TIME IS NOT YOUR FRIEND! When behind on payments, the interest and penalties pile up, and you lose what equity you have in the house. If you’re facing foreclosure, the best thing you can do is research your options and take decisive action. You can go to our foreclosure page where we detail most the aspects of the foreclosure process. Check it out.
At any time, you can give us a call. We are available to speak with you and answer whatever questions you have about the circumstances you find yourself in and provide options for you. We want you to avoid these effects from the foreclosure process.
Here are just a few:
There’s Denial of Credit. When your credit report shows a foreclosure, you will be automatically labeled you a “bad risk.” You lose your buying power. When you apply for a car loan, home mortgage, or even credit cards, you will likely be denied. And when you do get credit, you will face higher fees and interest rates. It can also affect finding a job. It’s no fun.
Then there’s the Loss of your Home Equity. One of the main reasons to buy a home is to build up equity. Equity is what your property would sell for minus what you still owe on the mortgage. The plan is to pay down the mortgage while the value of your property goes up. As the equity increases, your financial gains can reach hundreds of thousands of dollars. Foreclosure can wipe all of that out.
Another item is that you May Owe Deficiency Debt. Sometimes if your lender sells your foreclosed home for less than the amount you still owe on the mortgage, you may have to continue making payments until the debt is paid. A “deficiency debt” it will hugely affect your lifestyle moving forward.
If you’re facing foreclosure, we don’t want any of these bad things to happen to you. We suggest you act immediately to resolve your pending foreclosure. Having someone to talk to helps. We’re here for that. First thing we say is to make sure all your mail is opened and read. This really helps because the clock is running. Keep talking to your lender. Know his or her name! When they know you, they’ll be much more apt to look out for you. Plan ahead as much as you can. Remember, TIME IS NOT YOUR FRIEND!
Another consequence with foreclosure is that you have fewer options for housing. Foreclosure not only affect your current living situation. IT will affect your future housing as well. Landlords typically run credit checks on all prospective tenants, and your record will follow you. You will be deemed as a risk, and everything will become more difficult for you.
Even if you recover and get into a position to buy another home, your options for financing will be limited. Fannie Mae is one of the largest lenders in the U.S. that offer loans to troubled borrowers. However, Fannie Mae requires makes applicants with a foreclosure on their record wait 7 years before they’re eligible for a mortgage.
Finally, the threat of foreclosure can cause many sleepless nights, and affect your health and well-being. Take control of your financial situation and avoid these consequences.
You can call, text, email, or fill out the form on this page and we can help you take that decisive action you need to.