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. If we consider the statistics above, it’s obvious that many homeowners are in tough financial situations even before a 15
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