Nearly 18 million Americans are behind on their rent or mortgage payments. Those who own their home face risk of defaulting on their mortgage or home equity loans. The prospects may seem grim, but there are ways to deal with a house that is on the verge of foreclosure or pre-forclosure.
What is a distressed property?
A distressed property is any home where the owner can’t keep up with the financial responsibilities. This could mean they defaulted on a loan, or they can’t afford the mortgage or taxes. Furthermore, a distressed property can be related to the structure itself. Some homes have been neglected for so long they have fallen into disrepair.
What should you know about selling a distressed property?
- Know the value of your home:
You should get an idea of the true value of your house. There are different methods you can use to determine the value before you sell your distressed property.
One way is to pay a bit of money for a home appraisal. These appraisals take into account everything your home has to offer, as well as how it can be improved. Appraisers are professional who will give you their opinion on a fair market price.
You can also try to find a free home value estimator online to figure out what you might get from a cash buyer. You can fill out ours, here.
- Should You Repair or Sell As Is?
If you have a distressed house for any number of reasons, you will need to consider the return on your investment before you do, or pay for, any major renovations. Ask the following question: Are you going to make that money back on the sale?
You should also factor in the repair completion timeframe. If you have a deadline, it may not be in your best interest to try to complete the renovation yourself. There can be unforeseen issues that pop up in construction that could hurt your value, or finances.
Foundation and Flooring Problems:
If you have issues with your foundation, that can have a major impact on the value of your house. On average, you can expect to pay around $4,000, which can rise up towards $10,000. Additionally, it can take several weeks or months.
Sometimes, it isn’t the foundation at all. Broken, crumbling, or moldy floors might be a necessary fix for the house to be considered “sound”. This is the cheaper and easier of the two options.
Bad Roof:
When was the last time you had your roof repaired? Maybe you don’t even have any traditional problems, but if your roof is older, it will impact the price of your home. Furthermore, a leaking roof can cause tons of issues like rotting, warping or structural damage. That said, just because you see water spots, or mold, don’t assume your roof is the issue.
The cost of repairing a damaged roof depends on the extent of the damage, the cost of materials, and where you live. We’d consider shopping quotes if you’re set on getting the roof fixed before selling.
Windows:
If your home has dampness issues, it could be because of the windows. Window jobs can be extensive, especially if there’s mold. On average, you’re looking at between $3,000 and $10,000 for total replacement on a three-bedroom house.
Septic Tank Problems:
If you plan on selling a distressed property with a septic system, you need to make sure it’s working. If your tank simply needs to be emptied, it won’t set you back too far, but major fixes could require construction and a lot of money.
Additional Considerations:
If you are planning on selling distressed property to an investor, the renovation process probably isn’t the best route for you. If you start and discover more issues, that means more time, effort and money. When dealing with a distressed home, if you ever think “the home needs too much work,” consider selling for cash. For a better understanding of what your home is costing you, check out our tool here.
- Don’t Delay
If you’re home is distressed, and you’re close to defaulting on your mortgage, or going into foreclosure, don’t delay the process. The best, smartest decision may be to be prepared to take a cash offer from an investor. Traditional sales can take months – or longer – that’s time you might not have.
If you want a fair, cash offer on your house consider reaching out to us today. Our goal is to help every single person that calls. None of our calls come with any sort of obligation, so you can rest assured, if you don’t like the offer, you don’t have to accept it. You can call us any time, or fill out this form.
