Arizona is one of a few states that have an Anti-Deficiency Statute on the books. As a result, it may be a good place for investors to consider buying property. As a whole, the market in Arizona has taken a huge hit. That may be bad for owners, but for investors it creates the perfect niche to investigate when attempting to purchase rental properties or simply build up a real estate portfolio.
Many homeowners have gone into foreclosure or are listing their homes as short sales, and banks are beginning to let these properties go for a significant amount less than is owed. The homeowners losing their properties generally have protection under our Anti-Deficiency statute, and cannot be pursued for the debt if their property was utilized as a single or two family dwelling, and on 2.5 acres or less. That means they are not on the hook for the debt in most cases and are now in the market to rent.
That’s where the investment comes in to play. Not only can an investor pick up properties for less than is owed or valued, he can also benefit from the protection that the statute provides in the case that he himself loses the property. The statute does not qualify any property as a primary residence in order to get protection from creditor, it simply must be utilized as a single or two family dwelling. That can include a rental property being rented out.
Not that anyone in the state wants to add to the foreclosure rates, but this information may make Arizona an attractive state for investors. An investor just may want to know that in the end, if he has to let the property go, he will be protected for now from the obligation of debt.
Mary Frances Coleman, JD
AVP/Default Services Division Manager
Fidelity National Title Insurance Company
60 East Rio Salado Parkway 11th Floor
Tempe, Arizona 85281
480.214.4559 (Direct)
mfcoleman@fnf.com
www.fntarizona.com
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