What Is Distressed Property?

A property can be distressed financially (the owner is behind on mortgage, taxes, or HOA dues, or facing foreclosure), physically (major repairs, code violations, fire or water damage), or situationally (inherited, tied up in divorce or probate, owned by someone who's relocated).

Distressed properties are difficult to sell through traditional channels. They often can't pass lender inspections, scare off retail buyers, or simply can't wait the months a conventional sale takes.

Cash buyers specialize in distressed properties precisely because they buy as-is, close fast, and don't rely on financing that would be denied for a property in poor condition.