The last phase of foreclosure is repossession, which means that the bank takes physical possession of the home that has been foreclosed on. In several states with long foreclosure times, such as New Jersey, New York and Massachusetts, many homes are just being seized by the mortgage companies.
Many of the repossessed houses are in terrible condition because no one has been living in them and they have not been maintained by the bank.
Daren Blomquist, vice president at RealtyTrac said “That deferred distress often represents properties with deferred maintenance that will sell at more deeply discounted prices, creating a drag on overall home values.”
So many houses in very poor condition will be on the market soon, at reduced prices.