Many homeowners have no problem affording their monthly mortgage repayments until they experience an unexpected event that disrupts their finances. This can set off a domino effect that can lead them into debt and can spark wide-ranging cash flow problems.
If you are struggling to pay your mortgage, you may be looking into your option to avoid losing your home. Many people are worried about foreclosure and want to do everything that they can in order to prevent it. This often means that they consider going through a short sale or a bankruptcy.
Short sales are never ideal, and it is always best to take action as soon as you notice that your finances are not healthy. Your bank may be able to help you by adjusting your repayment obligations. The following are some of the most common causes of short sales that you should be aware of.
Divorce
Going through a divorce can have a huge effect on your finances. It can also mean that you are now living alone and have to afford the mortgage with one income instead of two.
Sudden illness
Illnesses that are sudden can take a huge toll on family expenses, especially when you do not have adequate insurance to cover the medical bills.
Unexpected unemployment
If you do not have savings, becoming unexpectedly unemployed can plunge you into debt extremely quickly and may force you to go through a short sale.
It is important that you understand exactly how short sales work before you decide to go through the process. There are many options that may be able to help you with your cash flow problems.