Why It’s Important to Plan for the Unexpected

Contrary to what you may think, maxing out your credit cards is not the primary reason homes end up in foreclosure and owners in bankruptcy. Neither is an unexpected repair bill. No doubt either situation can make it difficult to meet your financial obligations. But believe it or not, personal crises including illness, divorce and job loss are, more than anything else, the main triggers leading up to a lender’s foreclosing on a home.

When you’re shopping for a new home, you don’t think about these things happening to you. And perhaps they won’t. But they could, at any time, and that’s why you need to know your options before a personal crisis arises. Once it does, stress and anxiety will set in making creation of an effective action plan much more difficult.

If you’re lucky, you won’t be caught completely off guard. Talk at work of an impending layoff is all you should need to start reining in expenses and saving more. You usually won’t undergo a major operation or major home repair without some advance notice either. But still, even if you can arrange short-term financing to cover the bills, repaying it could cost more than you can afford. The bottom line is this: If you don’t have a plan for dealing with the unexpected, you’re putting your home at risk. To protect your home, you’ve got to be prepared to react quickly to any situation.

If you need help, get it. Don’t be ashamed or embarrassed because that’s only going to make matters worse. Start by seeing what’s available locally. Look to places you might not normally look such as churches and civic groups. They may have assistance programs for which you could be eligible. If not, there’s a good chance they can steer you in the right direction. Also check into local as well as state housing assistance organizations, and not-for-profit counseling agencies.