What Is a Distressed House and What Do I Do With It?

The average home
price was up 5% in 2020 and 2021 is on track to see modest increases as
well. While some people are taking advantage of the current real estate
market and selling their homes for full price or more in some cases, others are
buying up bank foreclosure properties. 

If you’re in a position to scoop up
one of these properties, also known as a distressed house, there are some
reasons why you might want to go ahead and do it. 

Why do homes or properties become
distressed? What do you do with a distressed house if you have one or purchase
one? Keep reading to learn more. 

What
is a Distressed Property? 

Do you have that one home in
your neighborhood that is in a state of disrepair? This is a distressed
property. How about homes ending up in foreclosure due to the massive unemployment
rate that resulted from the pandemic? These are also referred to as distressed
properties. 

A distressed property can be any
property (home or land) whose owner has fallen behind on either the mortgage
payment or tax bills, or both. 

A lot of times, companies will come
in and purchase these properties and turn them into rentals or rehab and flip
them for a profit. 

What
Do I Do With A Distressed Property? 

If you’re trying to unload a
distressed property, there are a few things you should do to get the best price
for it.

• Fix some of the more important issues going on with the
  home. 
• Verify potential buyers’ information to prevent being a
  victim of fraud.
• Be honest about everything to avoid the buyer pulling
  out at the last minute. 

Do you have a distressed property?
Are you wondering “How can I sell
my house fast?” Get a fair, all-cash offer for your property no matter
the condition or reason on your timeline. 

If you’re thinking about buying
a distressed property, there are some things to keep in mind. Let’s look at
some of them. 

• Research the area and try to find the most profitable
  real estate market. 
• Look for up-and-coming neighborhoods. 
• Get pre-approved for a mortgage to have a leg up on the
  competition. 
• Use an experienced real estate agent, preferably one
  with experience with distressed properties. 
• Stick to a budget for purchasing and rehabbing the
  home. 

Not all distressed properties are
good investments. Do your homework before committing to any property. 

Do
You Have a Distressed House to Sell? 

Now that you know what a distressed
house is and that there is a market for them, you can explore your options. Are
you a buyer looking for a distressed property or do you have a distressed house
to sell? Whatever your position, research the best way to handle it for your
situation. 

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