Preventing an impending foreclosure and selling at a profit

There are various reasons why property owners part with their real estate. Not all of them are of a positive nature. Divorces, sudden unemployment, or general financial bottlenecks can lead to a distress sale or even a foreclosure. A professional Real estate agent can help prevent a foreclosure and turn a distress sale into a profitable transaction.

Why do forced sales happen?

The most common reason for a foreclosure is bank debt that can no longer be serviced. The reasons for this can include unemployment, illness, or divorce. At first, the bank will merely send reminders. However, at the latest when the threat of loan cancellation is made, there is immediate danger. To get its money, the bank can initiate foreclosure proceedings in this case. For a property owner, this is devastating in two ways. Not only is there a threat of losing one's home, but a foreclosure also regularly yields significantly lower amounts than a private sale. Although the 5/10 limit is intended to prevent a property from being sold for an amount that is 50 % below the market value, if no buyer is found at the first appointment, this limit can be dropped at later auction dates.

What can be done to prevent this?

The first step should always be to contact the bank. In most cases, the lender is well aware that a foreclosure yields less money and therefore might not cover all debts. Consequently, the bank is usually willing to negotiate regarding a reduction or temporary suspension of repayment. In many cases, however, this is not enough to permanently escape financial distress. In such cases, a voluntary sale of the property may become necessary. Such a step has the advantage that a real estate agent can be hired to achieve the highest possible price for the property to be sold.

A common problem: disagreement during a breakup

A common problem in real estate sales can be divorce. This is especially true when the two partners disagree on how to proceed with the property. In such a situation, it is not uncommon for the two parties to be unable to agree on a selling price. If no solution is found, in the worst-case scenario, a partition auction threatens. This is also a forced auction, in which ultimately both sides must expect significant losses. In addition, there are extra costs for court and notary.

A broker can mediate

In such a situation, it can be worthwhile to consult a real estate agent. If a jointly owned property is involved in a divorce, it is necessary to determine its exact value. A professional real estate agent is capable of a precise valuation and can therefore provide more clarity in financial disputes. When selling a property, emotions should be put aside. In an emotionally charged divorce, however, this can sometimes be difficult. An agent can act with a cool head in such a situation and show the disputing parties the optimal way to get the maximum out of the property. The years of negotiation experience that a professional real estate agent has acquired over time can also help to settle certain disputes regarding the property.

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A question of time

Selling real estate privately often takes a lot of time and effort. In a financial emergency or during a divorce, however, many property owners may not be able to afford this. If the financial difficulties are substantial, even a loan deferral by the bank may only delay the inevitable. Anyone in such a situation may, in the worst case, have to accept significant losses on the sale price in order to preempt a pending foreclosure.

Real estate agents have numerous opportunities and networks at their disposal that significantly increase the chances of a quick and successful sale. This is especially important when the property owner has been given a deadline within which the required money must be raised.

A real estate agent saves you the headache

One of the most time-consuming and stressful aspects of selling real estate is organizing viewings. Even in a normal situation, managing various viewing appointments can be nerve-wracking. Experience shows that this is usually especially difficult in exceptional situations where, in the worst case, a foreclosure threatens. If divorce disputes are also being fought out, there is usually a lack of time. To make matters worse, many interested parties are out of the question as real buyers from the outset. Some just want to look at the property—either out of pure curiosity or because they want to sell themselves later.

A real estate agent prevents viewing chaos. Through targeted questions combined with their own experience, an agent can distinguish between serious prospective buyers and viewing tourists in advance. Afterward, they can independently organize and conduct the viewings without the property owners having to spend extra time on it.

Expertise pays off

The decisive advantage that a broker offers in the event of an impending distress sale is their expertise. In order to achieve an appealing sales proceeds, various factors must be taken into account. A professional real estate agent can accurately assess which target group a sales property is particularly suitable for. Accordingly, they can market the property in a targeted manner. In addition, many brokers use not only the conventional real estate platforms, but also their own comprehensive networks. In this way, they can present the property in question to a broader circle of interested parties. Many people who want to move but do not have the time for business reasons to look for a suitable property themselves hire brokers to do this for them. Through a real estate agent, sellers can connect faster with such a solvent buyer.

In addition, real estate agents possess the expertise and negotiation skills necessary to achieve a higher selling price for a property. Especially in situations where a large sum of money needs to be raised quickly to prevent a foreclosure, this can be worth its weight in gold.

What to do if the creditors already have a default judgment?

In that case, property owners can no longer simply sell their property. To do so, they must first obtain the bank's consent. In such a negotiation, it is advantageous to consult a professional real estate agent. In case of doubt, the latter is able to convince the bank itself that a private sale is in its own interest.

If you are interested in a quick and successful sale of your property, please contact us. We are happy to help you with our expertise and ensure that you achieve the best possible purchase price.