The The definition of the word "distress" according to Webster is that of "suffering of body or mind: Pain, Anguish, Trouble, Misfortune...." the verb definition includes, "subject to great strain or difficulties, upset". We now see numerous headlines in todays real estate industry refering to the phrase "distressed property" where the automatic conclusion is short sale and most agents that I have run across will immediately start moaning and groaning..."ahhhh...not another one....I do not have time for this....now what am I suppose to do? What paper work do I need?" The meaning of the word that seems to be forgotten is that of PAIN, ANGUISH, TROUBLE, MISFORTUNE...UPSET which can all be used to describe the homeowner! I think we would be hard pressed to find anyone in this position that is throwing a party! Yet for some reason, the attitude is that the homeowner did something intentional...some screw up of their financials....some greedy decision to buy the new flat screen television that caused them to travel this road of misfortune, and that attitude STINKS! It is not always, nor has it always, been a situation that was in the control of the homeowner that leads to this point. Yes, the over appreciation of the housing "frenzy" in years past (where I might add a lot of real estate agents entered the business thinking this was easy money..and who have since left the profession entirely) contributed along with the financial disaster that followed...but MANY homeowners have NOT done anything wrong and now find themselves needing HELP.
Distressed Property Definded:
1. Property that is in poor physical condition
2. Property that is or will soon be in some stage of the foreclosure process
3. Property that has an owner who is experiencing a period of financial instability
4. Property on which the mortgage obligation exceeds its current value, causing the owner to sell
Common thread here? Property....a house!
The point that many do not take into consideration is that this "property" belongs to a "family" and this "house" is their "HOME". There are human beings involved with every distressed property situation. Many who are in this situation have no idea where to go for help, even those who take a proactive role in dealing with reality. Even many real estate agents and mortgage brokers shake their head when the subject matter is brought up...simply because they lack the necessary knowledge of the road map that is necessary in dealing with such a situation and have passively listened to all of the rhetoric out there in the media that eludes to the "sky is falling" scenario. In the meantime, homeowners are apt not to face the facts head on and take the proactive stance of their available options in a timely manner....hoping all will be well tomorrow!
Recently I got a call from a client who worked at a facility that required a security clearance. His wife had been laid off from her job last fall. They were starting to fall behind on their mortgage payments. He was considering letting the mortgage company take the home back with foreclosure or possibly file bankruptcy. The problem with this situation is that if he opted for either of these two choices, he too would LOOSE HIS JOB! One cannot have a security clearance with either a foreclosure or bankruptcy on their credit report! Little know fact....but a fact none the less.
THE KEY TO THIS WHOLE SITUATION is KNOWLEDGE!
Knowledge of options
Knowledge of procedures
Knowledge of the possible outcome and repercussions!
TAKING ACTION!!!!!
No matter what caused the current crisis, we are left in a situation where families are being confronted with a devastating situation with a seemingly "no where to turn" scenario. There are solutions to the problem...it is just a matter of knowing the options. As the old saying goes...."plan your work....and then work the plan.." There is an out for many of these families who find themselves owning for whatever reason, a "distressed property" which in their minds is their home.
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