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Just because foreclosure rates are on the rise doesn't mean you are in danger of losing your property. However, you should be aware of some strategies that will help keep your mortgage out of default and your investment safe.
If you are just buying a property, your first order of business should be making sure that you've reviewed all agreements relating to the purchase and that you understand them. If you need help interpreting complicated mortgage documents, ask questions and do research before signing anything. If lenders seem hesitant to answer your questions, it might be a good indication that they're trying to hide something. Purchasing a home is a huge responsibility. Make sure you know what you're getting yourself into. Be aware of fluctuating interest rates and any other costs that may arise in the future. Even if you have owned your home for years and are just realizing now that you don't fully understand the terms of your mortgage, it might be wise to review them.
After purchasing a property, the most important thing for you to do is stay current on your payments. Once you've fallen behind on your mortgage it's very hard to catch up. Aside from paying on time, here are some other strategies you might want to use to make sure you remain in good standing with your lender:
- Pay high priority bills first (i.e. food, mortgage, utilities)
- Do not pay credit cards or other unsecured debts before the mortgage
- Use checks or money orders to pay your monthly bill (do not send cash or use your credit card)
- Keep records of all payments (dates paid and check #'s)
- Correct any errors that arise quickly
Aside from making payments, it's very important that you keep records of everything pertaining to your purchase in a safe and localized place. It's very likely that these documents will need to be revisited in the future. This file should contain things like (but may not be limited to):
- Purchase and sale agreement
- Mortgage application
- Closing Documents
- Property inspections
- Property tax bills
- Property insurance information
- Letters you receive from the bank or mortgage company
- Copies of letters you mail to the bank or mortgage company
- Payment documentation
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