What are some things homeowners can do to reduce the likelihood of a foreclosure?
Talk to your lender. Most lenders want borrowers. They don't want to own properties and they will do everything they can to help you through this process.
How to cut your risk of a foreclosure?
Save money. It's always good to have three to six months in savings in cash in a money market account. Also, take a hard look at your expenses. You can save an amazing amount of money by cutting down on uncessary expenses.
If you have been foreclosed, what does that do to your ability to get a loan again?
Your lender should be able to tell you what effect it should have on your score, but it will definitely affect your credit rating. It will take years to get your score back up. If you buy another house, you will have a higher interest rate and a higher downpayment.
Remember to protect your income.
Keep your job. Get additional training and make sure that you are valuable at your place of work. Know what's going on in your company.
For additional information regarding actions you can take to improve your financial well being, click here.
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Cal CPA (California Society of Certified Public Accountants) hosts the 2008 California Summit on Financial Literacy on Wednesday, April 23rd at the Sacramento Convention Center. This is a free event. For more information on this event, click here.
For more of Michael Finney's consumer stories and advice, visit 7 On Your Side.