Mortgage rates are on the rise and hitting multi-year highs, putting increasing pressure on people and families looking to buy a home or refinance an existing mortgage. But, with these high mortgage rates, who goes bankrupt first?
The answer is simple: no one. It all comes down to the borrower’s ability to manage their finances responsibly and carefully consider their options when it comes to repayment terms.
When it comes to mortgages, there are two types of borrowers: those who think in terms of what can I afford and those who think only in terms of what will look good on my financials. Unfortunately, the latter tends to over leverage themselves when they try to purchase a home or refinance an existing mortgage and leave themselves vulnerable to foreclosure.
Those who can afford it and are looking to manage their payments more responsibly should consider a “DP Trading Room Mortgage.” A DP Trading Room Mortgage is a unique type of mortgage that caps the interest rate at a certain percentage and allows homeowners to refinance at other rates once they hit the cap. This allows homeowners to lock in a lower payment for a longer period of time, making it easier to make the mortgage payments on time.
For those already overextending themselves and staring down rising mortgage rates, there’s still hope. It’s important to make sure you don’t give up and miss payment after payment. Instead, there are two important actions to take:
• Contact the lender and negotiate a repayment plan. This can significantly reduce the amount of money owed and help get you back on track.
• Contact a non-profit credit counseling agency. These agencies offer free credit counseling services and financial advice to individuals struggling with debt.
No matter how dire your situation may seem, understand there are solutions and you are not alone. The most important thing is to remain proactive and take the necessary steps to prevent bankruptcy.