prevent foreclosure, foreclosures and short salesIt may be a mute point to people already defaulting on their mortgage loans but in order to prevent foreclosure common sense has to be applied. The word common sense seems like something everyone would understand but that is not the case and we are paying for it now with foreclosure rates increasing every month and banks scrambling to cover billion dollar loses.

An individual should not spend more than 30 percent of their monthly income on rent. So if you are making 2,000 dollars a month only 600 dollars of that should go to rent. In today’s economy, that percentage may seem a bit low with the price of everything going up. It is too bad but it is true. The average person probably is spending something nearer 50 percent of their monthly income on rent.

To prevent foreclosure means making sacrifices. Try not to live beyond your means because it will lead to problems. It is understandable that you would be saving less and paying out more during this time but do not put yourself in a foreclosures and short sales situation.