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Question for the Money Doctors

Question submitted on Oct 14, 2012.

Question

Here in Maine, the residents are caught in a rising tax base, increased insurance base and way high fuel costs for gas and heating fuel. My question is, Those of us who have a mortgage and have had a tax and insurance increase that effects the mortgage due to the escrow amount needed to pay taxes and insurance, How do we keep the mortgage monthly ammount at a reasonable limit so that we don''t loose the house and property.?

Answer

Unfortunately, many people are seeing increases in their fixed costs (such as property taxes) rise faster than their income.  Fighting against this squeeze may require you to audit your expenses to see if any cuts are possible.  For instance, if your current mortgage has a higher interest rate than what is currently available, you might be able to achieve some savings by refinancing your existing mortgage at a lower rate.  Also, you might want to obtain some competitive quotes on your homeowners insurance to see if you might be able to save some money by changing companies or changing your coverage.  But keep in mind that if you change your insurance coverage, you might lose coverage for some risks that are now insured.  Make sure that you understand what insurance coverage you have and that you are comfortable with that.  Finally, it makes sense to review all of your other expenses to look for ways to economize so that you can make your income stretch through these difficult times. 


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