Company: Supreme Lending
Having financial problems? Can’t afford your mortgage payments anymore? You’re not alone. According to reports, one in five homeowners is “underwater” on their mortgage, meaning they owe more on their home than it’s worth. If you find yourself in this situation, you may be wondering what will happen if you default on your mortgage loan in Alaska.
When you stop making your mortgage payments, the lender can take legal action to foreclose on your home. If this happens, here are 10 consequences you’ll have to face:
- You could lose your home.
This is the most obvious and severe consequence of defaulting on a mortgage. If you stop making payments, the lender will eventually foreclose on the property.
- You could damage your credit score.
A foreclosure will stay on your credit report for seven years, which could make it difficult to borrow money or get approved for a new mortgage in the future. You could also experience a decline in your credit score, making it more expensive to borrow money or take out a loan.
- You could be sued.
The lender may sue you for the money you owe, which could lead to wage garnishment or a lien on your assets. This could also damage your credit score.
- You could have to pay taxes on the forgiven debt.
If the lender agrees to forgive some or all of your debt, you may have to pay income tax on that amount. This means you could end up owing the IRS a lot of money.
- You could lose your job.
Losing your home can lead to financial stress, which in turn can cause you to lose your job. There are many cases of people who have lost their jobs due to the stress of being in debt.
- You could lose your retirement savings.
If you have to sell your home in a foreclosure, you may have to use your retirement savings to pay off the mortgage. This could drastically reduce the amount of money you have saved for retirement.
- You could damage your relationship with family and friends.
Losing your home can be a very traumatic experience, and it’s often difficult to keep up relationships with family and friends when you’re going through such a tough time.
- You could become homeless.
If you lose your job and can no longer afford to pay your mortgage, you could become homeless. This is a very real possibility for many people who default on their mortgages.
- You could go into debt.
If you have to take out a loan to pay off your mortgage, you will likely end up in even more debt. This can be a very difficult situation to get out of and can lead to bankruptcy.
- You could ruin your credit for life.
If you default on your mortgage, it’s very likely that you will have a bad credit score for many years to come. This could make it difficult to borrow money or get approved for a loan in the future.