Dictionary of Business Terms: distressed property
distressed property
real estate that is under foreclosure or impending foreclosure because of insufficient income production.
Dictionary of Real Estate Terms: distressed property
distressed property
real estate that is under foreclosure or impending foreclosure because of insufficient income production.
Example: An apartment building is financed with mortgages that require $25,000 in annualdebt service. Because of high vacancies and rising expenses, Net Operating Income drops to $20,000. The owners have ceased making loan payments because their resources are insufficient to pay the negative cash flow. The property is considered distressed property.
