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Reasons for debt
During the economic boom, when property prices were rising rapidly, many people rushed to buy their homes, before they became unaffordable, and also to benefit from the rapid rise in real estate rates. Most of these houses were purchased using home loans, and the home owner has to make a monthly mortgage payment to repay the home loan.
However, due to the downtown in the economy, many home owners were laid off from their jobs or had to take a pay cut. Some Small business owners and self employed individuals were also adversely affected. As a result, many of these individuals were unable to repay the mortgage amounts, resulting in foreclosure of the homes. This results in additional losses for the home owner, who also has to make alternative arrangements for accommodation.