What is a distressed asset?
A “distressed asset” is a piece of property that must be liquidated quickly due to an unfortunate situation such as a divorce, relocation, or fire. Although it might seem unfair to buy someone’s property dirt cheap, it does have its advantages, both from the buyer’s and the seller’s perspective. From the buyer’s view, it means their budget can afford a better piece of property; for the seller it can mean closure to an unfortunate situation. However, it is important to keep in mind that scams can be disguised as a distressed asset.
Deals on homes are in every area of the country
When you’re ready for that opportune moment to snag a deal on some property, a good place to start is to look for sellers who are in a hurry to sell. Sources such as divorce lawyers have access to motivated sellers from divorce cases they are working on, making these lawyers an excellent resource for finding good deals. Divorcing couples with a house that has memories of their relationship often want to purge themselves of those memories by selling.
There are many types of distressed property situations
Sentimental value isn’t the only reason why people will want to sell their house the quickest way possible. Some may be going through financially hard times and want to get rid of the house they are in now and move to a smaller and cheaper home. For others, it’s the need to relocate quickly due to a job, or maybe the owner died, and the estate’s executor is trying to sell off the property so the living relatives can divide their inheritance.
Be careful! Is it a scam or a steal?
When deciding if a deal for a house is a scam or not, first try asking why the owner wants to sell the house quickly. Despite the answer the seller gives you, you should seek some professional services, or spend time doing serious research yourself. Depending on the situation, it could be a way for the seller to get out of a large debt and dump it on a buyer. Or maybe the house is in such a bad state that the actual value has dropped significantly.
Know how to buy distressed properties the right way
It is imperative for anyone interested in buying a low-priced property to do their homework in order to avoid being scammed or getting into a conflict with the seller and others involved in the transaction. Learning how to spot a scam from what seems to be an opportunity is a valuable skill. But the screening process can also be rewarding when you are sitting in a new home with extra cash to spare.
Residential / Farm Distressed Property
Commercial / Industrial Distressed Property