When does it make sense for a bank to sell a loan, or to hold and manage it?
When does it make sense for a bank to sell a loan, or to hold and manage it?
As many commercial buildings are in default, banks are faced with the decision of whether to hold or sell specific loans. Generally, banks take a look at the Net Present Value of the building. They estimate what the property is worth in today’s market, the cost that it will take to stabilize, and then manage the asset. They then compare that to the cost and time associated with the foreclosure process (which in some cases may take over a year). Most times, it makes more sense to sell the loan as opposed to holding onto the property as a lender.
For a full list of foreclosure, distressed, bank owned properties in St, George and Southern Utah, contact Brandon Vandermyde (435) 627-5735
