Introduction:
If you’re having trouble keeping up with your mortgage, a budget can help. With a few changes to how you manage money, you can prioritize your mortgage, cut down on extra spending, and protect your home. Here’s a guide to creating a budget that will help you stay on track.
1. Look at Your Finances
Before you start budgeting, it’s important to know where you stand. Gather your pay stubs, bills, and statements, then make a list of:
- Income: All the money you bring in each month.
- Fixed Expenses: Essentials like your mortgage, utilities, and insurance.
- Extra Expenses: Things like eating out, entertainment, and shopping.
Tip: Knowing exactly where your money goes helps you create a clear plan to save your home.
2. Focus on Your Mortgage First
Your mortgage payment is the most important bill to pay. Missing it can lead to fees, credit damage, and even foreclosure. Plan to cover your mortgage first each month.
- Automate Payments: If possible, set up automatic payments to avoid missing deadlines.
- Partial Payments: If you can’t cover the full amount, talk to your lender about making partial payments for a short period.
3. Reduce Extra Spending
Look for areas where you can cut back. Even small changes add up and help free up money for more important bills.
- Eating Out and Entertainment: Limit dining out, cut back on streaming services, and reduce entertainment costs.
- Save on Utilities: Try to lower electricity and water use to save on utility bills.
- Stick to a List: Only buy what you need when you shop to avoid extra spending.
4. Ask About Lower Payments
Many companies will work with you if you need help paying bills. Reach out and ask for options like payment plans or lower rates.
- Utility Companies: Some may offer programs to help with payments.
- Credit Card Companies: Ask about hardship programs or lower interest rates.
- Medical Bills: Many providers offer flexible payment plans.
5. Find Extra Income
If possible, look for ways to increase your income. A little extra can go a long way in keeping up with payments.
- Side Jobs: Consider freelancing, tutoring, or finding a part-time job.
- Sell Unused Items: Selling things you don’t need, like electronics or furniture, can bring in quick cash.
6. Use Our Free “Monthly Budget Assessment Tool“
Our free budget tool is here to help you take control of your money. Here’s how to make the most of it:
- List Income and Expenses
- Income Section: Start by adding all your sources of income, like paychecks and side gigs.
- Expenses Section: Add your fixed costs (like your mortgage) and extra costs (like eating out or entertainment).
- List all Debts: Make a list of Credit Card Loans, Car Loans, Personal, Student, Medical Loans and any other outstanding loans. This value goes into the “Debt Repayments” Section of the tool.
- Track Spending Weekly
- Weekly Check-Ins: Review your expenses every week to stay on track. Use the tool to see where you’re overspending.
- Adjust Goals: If needed, adjust your goals based on what you’ve spent that month.
- Separate Needs from Wants
- Mortgage First: Make sure your mortgage payment comes first. Then, see where you can cut back on extra spending each month.
- See Your Progress
- Monthly Summary: At the end of each month, check the tool’s summary to see how much you’ve saved. It’s a great way to stay motivated and see your hard work paying off!
7. Build an Emergency Fund
If possible, start saving a small amount for unexpected expenses. Even a few dollars each month can build up over time and help if something urgent comes up.
8. Talk to Your Lender
If you still can’t make your mortgage payment, reach out to your lender. Many lenders will work with you if you’re open about your situation. They may offer options like lower payments or a temporary break.
Tip: Communicate with your lender—they may have solutions to help you avoid foreclosure.
See our Communication Tips to Avoid Foreclosure blog for an in depth view on what to do.
Conclusion
Budgeting is a simple way to take control of your money, prioritize your mortgage, and protect your home. By reducing spending, increasing income, and using our budget tool, you can create a plan that makes a difference.
Call to Action:
Facing challenges with your home? Get our free, ‘Homeowner Survival Kit’ and discover practical solutions to help you move forward confidently. Download Free Survival Kit Here
Don’t let foreclosure take your home. If you’re a homeowner in Springfield, MO, facing the threat of foreclosure, refinancing may be your best option. At Promising Property Solutions, we’re here to guide you through the process and help you explore all available options. Want to learn more on what options you may have? We are giving away a FREE TOOL KIT to show you exactly what you can do.