CHAPTER 3
Reasons People Go into Foreclosure
WHAT CAUSES FORECLOSURES?
Buying your own home can be a wonderful, exciting adventure. Unfortunately, making regular mortgage payments and paying for home upkeep and improvements can add a lot of stress to your life and your budget. Statistics show that many homeowners already are at the financial edge: • An estimated 43% of American households spend more than they earn each year, according to the Homeownership Preservation Foundation data of 60,000 homeowners. • A MetLife study found that 52% of employees live paycheck to paycheck. • Nearly 42% of all American households do not have enough in liquid financial assets to support themselves for at least three months. • Overall, 46% of American households have less than $5,000 in liquid assets, including IRAs, according to researchers for the Levy Economics Institute of Bard College.
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