big city
33 realty
distressed real estate

distressed real estate in chicago

33’s Distressed Real Estate Services practice performs receivership, REO Management and Note & REO brokerage services for banks and other financial institutions. Unlike traditional real estate firms, we boast a team of former workout professionals, corporate finance consultants, engineers and attorneys. Our approach to distressed assets is consultative in nature and we can deal with simple property takeovers to contentious borrower disputes. We’ve served as Receiver on over 130 cases, managed hundreds of commercial and residential REO properties and completed in excess of $150M in distressed note and property sales. 
Distresed Assets in chicago

The team with experience

We’ve tailored our practice to meet the needs of an array of clients which include debt servicers, private equity funds, hedge funds and regional / national banks. Our integrated business model offers our clients a single point of contact throughout the entire process. This structure significantly reduces timelines to stabilization and minimizes costs for our clients
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How do I acquire a note or participate in a note sale? 

In real estate scenarios, notes reflect the contract entered between a lending institution and a borrower to finance a property. In other words, a note is a loan.  Acquiring notes typically requires personal relationships with lenders (banks, special servicers, other lending institutions). These lenders want to know that prospective buyers can close fast and have ample capital (cash) to complete a purchase.  Notes contain highly sensitive information about borrowers and are not made publicly available.  Investors of notes typically have one of two goals: (1) find a way to acquire the underlying real estate secured by the note by way of foreclosure or (2) charge contractual high interest rates (“default interest”) to the borrowers to earn a return.  Note purchasing can be very lucrative but requires an intimate understanding of the collateral securing the note.

What is Receivership?

Receivership is the appointment of a real estate professional to protect and preserve properties when a dispute exists between a bank and a borrower.  When a bank begins a foreclosure action against a borrower, they will approach the court to have a Receiver appointed to protect their property while the foreclosure case proceeds.  Receivers immediately take control of the property and assume the responsibility of collecting rent (when occupied), handling all repair and maintenance needs, and reporting to the court either monthly or quarterly as to the status of the property.  Receivers are typically discharged when the bank concludes its foreclosure suit and is awarded possession of the property

Is Receivership only necessary when there is a dispute between a lender and a borrower?

Receivership can be used in an array of scenarios when there is a need to protect a property during a dispute between two or more parties, or when the property presents a risk to the general public.  Oftentimes, estate and divorce attorneys will request the court appoint a receiver when familial disputes arise.  In other cases, municipalities will request the Court appoint a Receiver when a property presents a risk to the general public and needs to be made safe.  Fees for Receivership are typically paid through income generated by the properties, but when no income exists the owner of the property will ultimately have to fund the Receivership fees.

How is a foreclosure conducted?

When a borrower can no longer pay for his/her mortgage and is unable to reach a modification to their loan terms, the bank will approach the Court and initiate a foreclosure proceeding.  The bank has to present documentation evidencing that the borrower has been and remains delinquent in its payments and oftentimes prove to the court that they attempted to work with the borrower to resolve the default.  Foreclosures must go through the court system in which the property is located.  Typically at the end of foreclosure, there is an auction for the property.  If there are not any prospective buyers that offer to pay more for the property than is currently owed to the bank, the bank will take back the property through a credit bid.  A credit bid is simply the bank using its outstanding mortgage as its purchase price at the auction.
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