Foreclosures Steamboat Springs
Several years ago, many real estate buyers, sellers, investors, title companies, Realtors, lenders, attorneys had to deal with foreclosures. The entire United States real estate market was affected. Steamboat Springs real estate market was in the same pool.
At that time, In Routt County, the highest number of foreclosures, happened in between 2008 and 2013.Foreclosure peaks happened in 2010 and 2011. During these two years, slightly over 300 owners lost their homes annually in Routt County.
Generally, most distressed properties fall into one of two categories: short sale and foreclosure.
Short sale usually happens when seller is delinquent in loan payments and still has legal ownership of the property. Seller is offering property for sale at a price less than the amount owed. Because of that, seller needs to obtain approval for the sale from lender. Lender is taking a loss along with seller. So, in the first part of this process seller negotiates purchase price with buyer. Once they agree on a price, seller and buyer start negotiating with lender.
Besides facing a loss, there are a few more downsides of short sale. Internal Revenue Service is considering debt relief as income. Because of that, seller will need to pay taxes on the amount he/she is short on the mortgage. Furthermore, seller’s credit will be impacted also. Most of the time, seller won’t be able to get another mortgage to purchase a property, for at least two years. Overall, short sale is better option than foreclosure. Unfortunately, there are many short sales that are not successful. Alos, there are lots of short sales that go under contract, but not all of them make it to closing.
If short sale was unsuccessful, the next step is usually foreclosure. During foreclosure, lender has taken legal ownership of the property. Comparing the number of foreclosures and number of successfully closed short sales, it is safe to say, that most sellers were unsuccessful in selling short. In Colorado, there are three types of foreclosures. The most common one is where lenders, either deal with buyers directly, or through a facilitator.
Most distressed properties have a lower current value than what sellers owe for the property. When buying distressed properties, it is important to consider potential frustration that comes from dealing with the lender through the buying process. Another challenge that comes with buying distressed property is, most owners will only sell property in “as is” condition. In general, short sale and foreclosure sellers, are not willing to discount their price more than 2%-4%.
If you are looking for distressed properties in Steamboat area, or for the best deals on the market, please feel free to contact me. We will make sure you will be notified as soon as foreclosure or short sale property comes on the market.
I’ll be happy to notify you on all other properties that would meet your needs. If certain Return On Investment (ROI) is what you are looking for, I’ll be happy to keep you posted on all new listings and market updates.