4 families rebuilding finances post-foreclosure

4 families rebuilding finances post-foreclosure

Even after a sheriff’s sale, the financial and emotional strains that surround a foreclosure are rarely over.

For the past six months, the Associated Press has followed four families who lost their homes in the past year. Three of them are regaining their financial footing, but one has sunk deeper into poverty and depression.

There have been more than 1.6 million foreclosures since the beginning of 2007, according to RealtyTrac. Today, a record 12% of American homeowners with a mortgage are either behind on their payments or facing foreclosure. And that record is expected to be broken repeatedly for another year, depending on how many people lose their jobs in the recession.

Job or income loss remains the No. 1 reason people fall behind on their mortgages, followed by excessive debts and illness in the family, according to a survey by Freddie Mac.