How to Avoid Losing Your House - Smart Strategies

Protect Your Biggest Investment

Chances are your home is the single biggest asset you own, and the roof over your head does much more than protect your family. That place you call home is also a huge investment, one you do not want to lose if disaster strikes.

Unfortunately, you cannot predict the future, and when trouble strikes it can be hard to tell where to turn. If you are facing foreclosure or worried about losing your home, call Saunders & Associates now at 949-844-8445. It is important to act fast before an already dire situation gets even worse. 

Here are some smart strategies that can help you protect your biggest and most important personal and financial asset.

Refinance to a Lower Payment

If interest rates have dropped since you bought your home and took out your mortgage, you may be able to refinance into a less costly payment, giving you some budgetary breathing room in the process. Refinancing can be a great strategy to protect your home, one that will help you build more equity and pay less interest in the long run.

Be Careful About Using Your Equity as a Piggy Bank

When times are good and home prices are rising, it is easy to see the roof over your head as a source of ready cash. In rising real estate markets home equity loans are easy to get, but they are often not appropriate, and using them the wrong way could cost you dearly.

No matter how much equity you have built up through the years, you should use caution and not turn your home into a piggy bank. Instead of turning to your home for extra money and taking out what could be a costly loan, look for other sources of cash, like a side hustle or part-time job.

Watch Out for Romance Scams

Sometimes it is not your head that gets you in trouble – it is your heart. Romance scams are growing increasingly common in the age of online dating, and falling for one could put your home at risk.

If you are jumping back into the dating pool it is best to proceed with caution and watch out for the red flags and warning signs. If your new paramour quickly declares their undying love, asks for money, and refuses to meet face to face or even video chat, it may be time to move on before you put your heart and your wallet at risk.

Use Caution with Home Improvement Loans

It is easy to view your home as an investment, and in many ways the roof over your head is just that. Over time your home should increase in value, and that means the equity you have built up will become more and more valuable.

If you are viewing your home as an investment, you may think that taking out a loan to make it even more valuable is a no-brainer, but it is best to proceed with caution. While many home improvement projects will indeed increase the value of your property, recouping that investment will mean selling the home, something you may not be prepared to do.

The problem with home improvement loans and home equity lines of credit is that they can literally put the roof over your head at risk. If a job loss strikes, global pandemic or something else goes wrong, you could be unable to pay off the loan, and that could put your home into foreclosure.

Consider Renting Out a Room or Section of Your Home

If you are facing foreclosure and unable to pay the mortgage, you might think that a short sale or other drastic measure is the only possible course of action, but thanks to the internet that is no longer the case. Instead of moving out, you could move someone else in using services like Airbnb, VRBO, and others to find short-term renters who need a place to stay.

If you need a more permanent solution you might want to consider renting out a room on a monthly basis, using the money you earn to pay the mortgage and keep the roof over all your heads. If you have a large home with a separate entrance, you may be able to turn that spare space into a money-spinning apartment, not only helping you pay the mortgage but allowing you to earn some extra income on the side.

This home retention strategy may not be right for everyone, and some people will not be comfortable welcoming strangers into a spare room or part of their home. If you are facing dire circumstances and worried about losing your home, however, renting out the extra space could be a viable option. At the very least the rental solution will buy you extra time, so you can work to get back on your financial feet and avoid foreclosure.

If All Else Fails, Downsizing Might Be the Answer

There are many ways to protect your house, and each one has its advantages. Even so, there are times when none of the strategies listed above will work, and in the end, you may need to downsize into a less expensive property.

Strategic downsizing has a number of important advantages, including freeing up equity in the house you are selling and giving you the chance to buy your new property for cash. If all else fails, selling your current home and downsizing into a less expensive property could be your best available option.

Whether your home is humble, grand, or somewhere in between, you have worked very hard to afford it. You have put in long hours, saved up your money, and paid your mortgage on time.

Now you are facing some difficulties, and you are worried about losing your home and desperate to protect it. When faced with these circumstances, you need Saunders & Associates, APC on your side. We guide our clients through difficult issues, bringing our insight and judgment to each situation. 

Our innovative approaches create original solutions to our clients’ most complex deals and disputes. Saunders & Associates, APC will be your guiding light.

Call Us 949-844-8445 . . . You Are One Call Away From Saving Your Home