Distressed housing can be classified in many different ways, but typically they all relate to a foreclosure. The classifications that you may most often hear about are HUD Homes, Short Sale, Auction Homes, and Foreclosed Homes.
A HUD Home is a home that the government provided the loan, and that loan has defaulted. Because the government closed down on the home, the foreclosure is then processed through them, and a HUD realtor then sales the home.
A short sale is a home that is pre-foreclosure. This is sometimes the best alternative for banks and borrowers, because rather than selling a home that will foreclose, sit there and be expensive for the bank and destroy the borrowers credit, this option gets the home into somebody elses hands before this situation ever occurs.
An auction home happens once the foreclosure process has been carried through, and the bank repossesses the home. The bank then takes the home to an auction for the amount that was remaining in the mortgage.
If nobody purchases the home, it is then classified as a foreclosure. These steps each take a while, especially right now as there are many homes in the foreclosure status, so banks are slow to get around to all of them.
Either way, what this means for a buyer is that homes are being sold for far less than the market value, which means tons of saved money for buyers. You can find your home here by shopping:
