For millions of people, monthly mortgage payments are a source of anxiety. Every month, you worry about whether or not you can make your mortgage payment – and you’re constantly living on the edge, wondering when your finances will collapse. Your mortgage payment is probably your biggest living expense, and arguably the most important one, so if you’re living paycheck to paycheck, the struggle can be overwhelming.
What can the average person do to lower their mortgage anxiety and take better control of their finances?
Step One: Analyze Your Situation
Before you start brainstorming about possible solutions, it’s important to get a grasp on your existing situation. Why is your mortgage causing you anxiety? And what are the root causes of this financial situation? If you understand this, you’ll be in a much better position to regain financial control.
- Mortgage payment breakdown. Ideally, you’d spend less than 30 percent of your gross income on monthly housing expenses. That means if you’re making $2,000 per month, you should be spending $600 or less on housing. If you’re paying far more than this figure, it’s a sign that you’re living above your means. It’s also a good idea to break down your mortgage payment. How much are you paying in principal, interest, property taxes, and insurance? Are any of these areas excessive?
- Expense breakdown. Next, take a look at other expenses that you currently have. Your mortgage might be perfectly affordable, but you might find yourself in a bad financial position if you spend too much money on going out to eat, subscription services, and other forms of superficial entertainment.
- Income level. How much money do you have coming in? And what are your prospects for increasing that income in the near future? Are you currently struggling because you recently lost a job or suffered reduced income?
- Property scope. It’s also a good idea to study the scope of your property. Are you in a perfect neighborhood with shockingly high property taxes? Are you in a house that’s way bigger than what you actually need? If you’re living at a level above your core needs, it might make sense to move to a new house.
Ask yourself these questions:
- What is the source of your financial problems? There are probably many reasons why you’re in a difficult financial position, but what are the main culprits? What is the true source of your financial imbalance?
- Is this house “too much” for you? Are you paying too much money because your house is more than what you need? If so, selling and moving is probably the best option.
- What are your primary goals? Moving forward, what are your primary goals? Do you want to keep the house no matter what? Are you trying to create a sustainable financial future? Or do you just need immediate relief?
How to Regain Financial Control and End Your Mortgage Anxiety
These are some of the best ways to regain your financial control and put your mortgage anxieties to bed.
- Sell the house in cash. Your first option is to sell your home in cash. This is by far the easiest, most straightforward solution. All you need to do is get a cash offer from a willing buyer, and you might be able to close the deal in a matter of days or weeks. You’ll receive a check that you can use to pay off the rest of your mortgage and, hopefully, put a down payment on a new house or find alternative housing. Cash offers are usually below market value, but they’re immediately available and they’re incredibly fast and efficient.
- Sell the house conventionally. If you’re feeling lucky, you might try to sell the house conventionally, either on your own or with the help of a real estate agent. You could end up with a better offer this way, but keep in mind that it could take months to find the right buyer.
- Pick up more work. If your financial gap is relatively small, you might be able to close it easily by picking up some more work. Taking on a part-time job or turning your hobby into a side gig could give you a few hundred extra dollars each month. It might be some extra work and extra stress, but if you’re desperate to keep your home, it might be worth it.
- Cut your other expenses. If you’re spending too much money on a regular basis, the solution is probably to cut your expenses as much as possible. Start living more frugally, reducing your consumption levels, trimming your entertainment expenses to the bare minimum, and shopping for cheaper groceries.
- Ask for a forbearance. If your financial issues are temporary – like if you recently lost a job – consider asking your lender for a forbearance. This will essentially put your mortgage payments on pause, giving you a few months of leeway so you can figure out a better path forward. It’s a much better option than simply not paying your mortgage.
- Negotiate with your lender. You can also try negotiating with your lender. Do they have any special options or payment plans available for people struggling to make ends meet? Do they have recommendations on how to move forward?
- Refinance the home. If there’s a problem with your mortgage, you might consider refinancing. Through refinancing, you might qualify for a lower interest rate, or you could convert your variable interest rate mortgage into a fixed rate mortgage.
If your mortgage payments are overwhelming, or if you feel like there’s no way out of your current financial situation, remember – there are always options to get relief. One of the best is to get a cash offer on your home. It’s quick, easy, and could be exactly what you need to get a fresh start. It only takes a few minutes, so get your free cash offer today!