Survival Tactics For Life After Foreclosure


If you're in foreclosure, facing foreclosure, or have recently lost your home in a foreclosure, here are some survival tactics you can use to keep moving forward.

The key is not to look back! Move forward. As hard as that might be, this is not the time to start asking yourself what you could have done to prevent this. It's done …let's move forward and get back on track. Thousands of people are in your same situation these days, you need to keep your head up, and stay focused. You have to remain open to spot good opportunities as they come along.

You need a new place to live:
If you're still in the home but in foreclosure, this is going to be your best chance to save some money for a home to rent. If you are in the home during the process you will need to put aside the monthly amounts you would have paid the mortgage company or bank. You must save at least two months rent plus a deposit. Unfortunately your credit score will be affected and landlords and rental agencies will be looking closely at that. You will likely have to pay two months advance rent as well as a deposit. Keep this in mind as you prepare to leave the home. When choosing a place to rent, you want to make sure it fits your budget. A good rule of thumb is the rent should not exceed 1/3 of your gross monthly income, before taxes. If you can do it try to rent a home where you can start saving money. Keep what you save in a wealth account. You will want to start rebuilding as soon as possible.

When you do find the right place your best bet is to have a cashier's check in hand along with proof of income. Overcome any objections and don't be shy about sharing your plans to get back on track with your finances. There are understanding people out there, something will come along you just have to keep looking.

Some banks offer a program called "Cash for Keys". The bank that is foreclosing on your mortgage may try to persuade you with a few thousand dollars to move out within the first month. It's easier to sell an empty foreclosed home, than one with the family still in it. If the amount the bank is offering is greater than 3 or 4 months payments, it's worth considering. Sometimes you have to be the one to ask. Find out all of your options before you make your plan.

Your Credit Scores:
Mortgages weigh heavily on your credit score. After the first missed payment you can expect your credit score will drop by 100 points. Banks, mortgage companies and the credit reporting agencies do this to make sure that you don't run out and apply for more credit cards. The drop in your credit score of 100 points will stop any and all banks from issuing you new credit immediately, but you still have open credit lines with your current cards. If they're not maxed out yet, use them wisely as you move forward. Unlike bankruptcy, you still have accounts to maintain. Paying the minimum monthly payments on these accounts is paramount. To overcome the late mortgage payments and the foreclosure, you will need three open credit lines that are paid on time for 36 months in a row.

Income Source:
Your income is the most important part of the plan after foreclosure. The plan must include all necessary steps to keep your job or get a job as soon as possible. This is not the time to look for the "dignified" job. Just get a job! In your current job, look for ways to increase your income, take on new responsibilities. You're now on the road to recovery and need to go the extra mile to ensure that you work your way out of debt for the next 36 months. Most importantly you need a plan to recover. You can recover. There are many ways to supplement your income.
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