The Causes of Distress

It is estimated that most American Families can only maintain their current living expenses for 60 days or less when income is interrupted for any reason.

1. Payment Increase or Mortgage Adjustment
   This is the single largest reason for distress in today's market. Although mortgages increase on a schedule and owners know they are coming, many do not do anything until it is too late or even worse. They do not think they have any options.
2. Loss of Job
   When an individual loses emloyment, the loss of income is most often immediate, and very quickly financial distress can occur and seem insurmountable.
3. Business Failure
   For a small business owner, the devastation of a business failure is often followed by the inability to pay mortgage payments and the loss of their home.
4. Damage to Property
   Many times insurance companies do not cover the full amount of damage to a property and homeowners are unable to make repairs. Some homeowners have to use insurance funds to survive and find new living arrangements.
5. Death of a Spouse
   The death of a spouse is devastating to a family, and if the person was also one of or the only wage earner, this will almost always cause financial distress.
6. Death of family members
   The death of a family member, regardless if they are a wage earner or not, can throw a family into emotional and financial turmoil.
7. Severe Illness
   Severe illness and the medical bills involved along with the time that it takes away from a family's productivity, can cause bills to be missed and homes to go into distress.
8. Inheritance
   Rarely does someone think of an inheritance as a means for distress. However, heirs are left to pay mortgage bills, utilities and main­tenance that they did not expect. Imagine a son who makes $60,000 a year whose parents pass away and leave him with a $700,000 mortgage and payment on a $1.5 million property. He will quickly need to find a payment solution (which there may not be) or liquidate the property and satisfy the mortgage. As you can see, even proper­ties with significant equity can be in danger of being lost to foreclosure if a solution is not implemented.
9. Divorce
   It goes without saying that divorce is one of the most common reasons for financial distress in the real estate market.
10. Separation
    When a couple decides to separate even though they are not actually divorcing; the cost of maintaining two households can cause the loss of a primary residence.
11. Relocation
    Homeowners do not always have control over where they live; many relocations are neces­sities not choices. This can quickly cause unexpected distress since very few homeowners can support two households for any significant length of time.
12. Military Service
    Except for the relief provided in very specific situations by the Servicepersons Civil Relief Act (SCRA), military service can lead to unexpected financial issues. Servicepersons, who have had their periods of active duty extended, are suffering a tremendous amount of financial pressure.
13. Insurance or Tax Increase
    For many homeowners just the increase in taxes on an annual basis or the increase in an insurance payment can cause a family to lose a home or go into financial distress.
14. Reduced Income
    If a person is in a commission based business (like a real estate agent) and the economy suffers, often times their income suffers. Also many businesses are reducing employee compensations to make up for lost revenues that corporations have suffered.
15. Too much debt
    For a family with credit card debt, even minor increases in their interest rates can make the difference between paying all their bills and missing payments.
16. Incarceration