Contrarian Capital Management: Understanding Distressed Property

1. Contrarian Capital Management:
Understanding Distressed Property

2. The experienced team at
Contrarian Capital Management looks for
opportunities to acquire distressed assets
such as securities and real estate. Contrarian
puts different strategies into effect depending
on the type of asset its team wishes to
acquire. When targeting real estate, the
company prioritizes property ranging between
$5 million and $50 million and might also offer
financing opportunities to borrowers if they
meet specific qualifications.

3. Investors define distressed property as real
estate that has entered foreclosure. The term
"distressed" does not describe the state of
the property, but rather its financial
circumstances. Even homes that have
recently received numerous improvements
such as repairs, remodeling, and additions
would still considered distressed if they
entered foreclosure.

4. Distressed properties are linked to
mortgages. When an individual can no longer
make mortgage payments, the property
enters foreclosure. Once again in charge of
the property, the bank aims to sell it off and
make back the money they loaned as a
mortgage. If the bank cannot sell the
property, it becomes distressed.

5. Most distressed properties crop up during
economic downswings. Often, individuals
who have received mortgages lose their jobs
and their ability to make payments during
these recessions. Their distressed properties
tend to sell at significant discounts.
Individuals interested in buying such a
property should inspect it thoroughly to get an
idea of its condition before signing
paperwork.

6. Most distressed properties crop up during
economic downswings. Often, individuals
who have received mortgages lose their jobs
and their ability to make payments during
these recessions. Their distressed properties
tend to sell at significant discounts.
Individuals interested in buying such a
property should inspect it thoroughly to get an
idea of its condition before signing
paperwork.