Distressed Sale

A distress sale—also called a distressed sale—occurs when a property, stockpile, or other asset must be traded quickly. Distress sales often result in a fiscal loss for the retailer who, for reasons of economic pressure, must receive a lower price. The profits from these assets are most often used to pay debts or medicinal expenses or for other tragedies.

KEY TAKEAWAYS

  1. Distress sales occur when the seller needs to sell an asset immediately, often to pay debts or medical expenses or for other emergencies.
  2. A short sale is a form of distressed sale in which the homeowner attempts to sell their property even though the current market value is below the amount owed to their lender.
  3. Distress sales often result in a financial loss for the seller because buyers realize that the seller is in a hurry to obtain funds and will offer a lower price.
  4. Buying a property through foreclosure or a distressed sale may mean that the property is in a poor state of repair.

 

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