You might have had great hopes for living the good life and paying off your mortgage when you signed on the dotted line; but no one can predict the future. Problems might have made it very difficult for you to handle your financial duties.
Usually mortgages are the most expensive duty that someone will face. Your home is expensive and you might have a 30-year mortgage to contend with. Unfortunately, circumstances change and sometimes, they change for the worse.
You might have had reduced hours at work, a medical emergency or family problems. Still, you have the mortgage payment hanging over your head. What can you do when you are barely keeping current with your mortgage payments?
Tap Into 401(k)
Do you own a 401(k) retirement plan? You have the right to access a certain percentage of your 401(k) funds to help you with cash flow problems. There are no penalties if you withdraw under certain circumstances. Some of those include: qualifying for disability, specific medical bills, disaster relief, or if you’re let go from your work after age 55.
That being said, it’s not the best idea to tap into your 401(k), but there are times and circumstances where it’s necessary. Most financial experts explain that “before you make any withdraws at of your 401k, do more than just read one post. Consult your financial advisor and/or tax professional to make sure you have your bases covered.” This is a pretty tricky issue and not being careful in the beginning can cause a lot of issues down the line.
Many traditional bank loans are very restrictive. It almost seems like they want you to remain stuck. Not so with many refinance loan programs - most have more flexibility than conventional refinance loan programs.
We understand that life changes. As life changes, looking into VA refinance options can help lead to accomplishing many goals, such as getting a lower monthly mortgage payment, debt consolidation, home improvement projects, and paying off your home faster You can look into refinancing to see if you can find better terms that reflect your present financial state of affairs. Life changes, so shouldn't your mortgage change too?
You can also use the cash out refinance option to pay off your other debts. It might not be just your mortgage, but your overall debt load that is problematic. Again, tapping into your debts like your mortgage aren’t the wisest idea, but sometimes it’s necessary to help get rid of your high interest options before dealing with things like your mortgage.
If you’re wanting some more information on loans and other lines of credit, make sure to read these other articles!