Wednesday, April 30, 2008
No way out?
Faced with foreclosure, a number of pre-retirees are borrowing from retirement savings to hold on to their homes. This desperate strategy means that borrowers may have to keep working for many years. But worse, if a borrower defaults on a loan from a 401(k), hefty penalties and taxes come due. This is one way that the current housing crisis may morph into a future retirement crisis.
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Hearing stories like these can get discouraging at times. With the economy not doing so well in the United States it seems like these kinds of stories are becoming more and more common. People losing their jobs, therefore they can’t pay the mortgage, and then the bank forecloses on their home, and in some cases the same happens with their car. When there are no more jobs available for hire than people get trapped in this position with nowhere to turn. It is even more sad when senior citizens get trapped in this position and have to take money out of their retirement funds to keep from loosing their homes. Then in return they’re having to work years longer to make up for the money that was deducted from those retirement funds. There has to be some positive changes made quickly to stop this vicious cycle in America. Once the United States economy has balanced out again then the real estate market will be swamped with home buyers. When it comes time to move make sure you research the company you decide to use help you move first. There are many credible companies out there that will help make the move a lot less stressful while lending a helping hand to assist you with the move.
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