After finally saving up enough money to use as a down payment, I decided that it was time to hit the market. I met with a lender, got pre-approved for a loan, and then started visiting different properties. However, I quickly realized that I didn't know as much about real estate as I would have hoped. I wanted to find a great neighborhood and know what to ask the professionals, but I could tell that I needed a little help. To point me in the right direction, I started working with a great real estate agent who was familiar with the area. This blog is all about educating the general public on real estate matters.
In some cases, a distressed property is one whose owner is unable to meet the mortgage obligations. However, that is not the strict definition of a distressed property. A property is distressed if you have to sell it in an urgent manner, even if you have to do it at a loss.
Triggers of Property Distress
A house facing foreclosure is a classic type of distressed property. Apart from foreclosure, there are other factors that may trigger property distress.
A defective house that you cannot afford to repair and you have to sell in its defective state, is a distressed property. Maybe the roof is leaking, the walls are starting to crack, or the electrical, plumbing, and heating systems are acting up. In such casa cases, you have to sell the house as soon as possible because the defects will only worsen with time.
Your property may also be distressed because you are going through a divorce and you have decided to sell the house, or perhaps the court has ordered you to do so. Maybe none of you can afford to keep the house, so you have to sell it and divide the proceeds.
In some cases, death in the family may also trigger a distressed property sale. Maybe you have inherited a depilated house from your deceased parents, or you have lost a spouse who used to help you shoulder the mortgage payments. Many people choose to dispose of the properties in such cases.
Owning a home isn't cheap. Apart from mortgage payments, you also have to pay utility bills and property taxes, as well as maintain the property. Losing a job may make you unable to take care of these costs, in which case you may decide to sell the property as distressed.
Tips for Selling Distressed Properties
Just because you have a distressed property for sale doesn't mean that you should accept the first offer that comes along. Here are a few tips to help you sell your distressed property at a reasonable price.
Make Cosmetic Improvements
You might not be able to make major repairs or renovations, but you can make cosmetic improvements to the property. You can mow the lawn, trim the trees, and clean the house to make it attractive to prospective buyers.
Try Nontraditional Property Sales
The traditional way to sell a home is to negotiate with a buyer who relies on a mortgage to pay for the house. There are other, nontraditional methods that may work better for you, depending on the market and your property's condition. For example, you can look for cash buyers or hold an auction to sell the house.
Mask Your Desperation
The buyers don't need to learn that your property is distressed, at least not from you. The buyers may use that information to negotiate lower prices.
Since time is of the essence when selling a distressed property, you should avoid everything that might slow down the sale. For example, you need to disclose everything so that a buyer doesn't learn about a defect and stop the purchase process.
For more information on how to sell a home, contact a realtor near you.Share