4 Mistakes to Avoid When Dealing with Financial Stress
Dealing with financial stress is particularly challenging and not something you should suffer with alone. Unfortunately, there are many mistakes people make that worsen their financial stress.
Have you recently had to deal with unexpectedly losing your job, medical expenses or poor purchase decisions?
These are common financial problems faced by most families in their lifetime. If you take precise measures early enough, these situations are manageable. For example, if you’re unable to pay the mortgage, selling your house makes a lot of sense. However, most homeowners end up making mistakes that cost them dearly and make dealing with financial stress much harder.
To help you on your journey, here are some of the most common mistakes that you should avoid when struggling with financial stress.
#1 Waiting Too Long To Sell Your Home
Waiting too long to sell your home is a big mistake when dealing with financial stress, as it can create a lot of frustrations and you are only delaying the inevitable. We understand it is difficult to let go of things you love, but at the end of the day, a home is like any other asset and not worth a stain on your credit. Some homeowners end up borrowing more money or using their retirement funds to keep a home. Unfortunately this usually digs them deeper into debt.
#2 Reducing Monthly Payment
Many homeowners will make the crucial mistake worsening their financial stress by reducing their monthly payments. You could get monthly payments reduced by asking for a loan modification. However, this can affect your credit rating and could cause problems in the future. This can add to your financial stress and is not a long term solution.
#3 Debt Consolidation
Debt consolidation sounds good and could even help you initially by way of lower payments when you are dealing with financial stress. However, debt consolidation can hurt you in the long run. Closing so many accounts to consolidate down to one payment can actually end up hurting your credit score. This can be a mistake, and is something you should avoid without professional help to ensure it is the right decision for you.
#4 Risking Foreclosure
If you are running short on cash or you’ve lost your job, it’s time to take a hard look at your current situation. Can you manage to keep the house, or would you like to sell it quickly to avoid foreclosure? Many homeowners make the mistake and struggling with financial stress because they risk foreclosure.
Dealing with financial stress is not a nice position to be in. Make sure you avoid these mistakes when dealing with financial stress.