How much will a foreclosure in your block affect the value of your home?

 


Question:

We moved into a nice maintenance free senior citizen town house complex six months ago and now one of the units is in foreclosure. It took all of our savings and sell of the old house to buy this unit.How much money can we expect to lose?

Answer:

If the unit near your town house is still under the process of foreclosure, the value of the surrounding properties are not yet affected. Once the house is already foreclosed on and the property is already sold through public auction or through any other way, it would be different. The effect or impact of the foreclosure on your property will depend on how much the foreclosed house was sold, whether it was sold below or near the fair market value.

If the lender was able to sell the property at or near the fair market value, the impact of foreclosure on your property would be at the minimum. However, if the lender has taken a bloodbath on the property or if it was sold way below the fair market value, the impact on the value of your property will be greater. The only way for you to retain the value of your house would be to get a buyer who agrees to buy the foreclosed home at or near the fair market value. Lastly, if the house near you is not completely foreclosed yet, you may help the borrower solve the foreclosure issue. This way, the value of your property will not be affected at all.

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