With Black Friday behind us, the holiday shopping season is well underway. From now until the holidays, consumers everywhere will flood malls and retail stores to make their holiday gift purchases. Studies show consumers are expected to spend more this year than in the previous three years. The reports suggest improvements in the economy will lead to a 4.1% increase in purchases in November and December.
Despite an improving economy, many shoppers will make a large number of purchases that may disrupt their finances and ability to pay their bills on time. According to a study by the Harris Poll for Atlantic-based SunTrust banks Inc., many consumers feel pressured to overspend during the holiday shopping season. The report found 53% of parents with children under age 18 feel pressure to overspend. Similarly, 40% of consumers overall reported feeling the same pressure. The study estimates that one-fifth of those surveyed are behind on paying a mortgage note, utility bill, or another regular monthly bill as a result of overspending.
This is important news all mortgage note owners need to take into account. To protect the value of their mortgage note, note holders should pay extra close attention to borrowers who are paying them on a seller-financed mortgage note. Borrowers who get too far behind on payments cause trouble for note owners who plan on selling their note in the future. Late payments will devalue the note in the eyes of investors who are buying the mortgage notes.
Note owners who plan on selling their notes after the holidays shouldn’t wait to do so. Instead, they should start the process now to avoid any problems with producing a clean payment history. That way they won’t risk getting top dollar for their mortgage note.