How to detect a bankruptcy of developer

Posted: September 10th, 2013 | Author: | Money

Every business has its own characteristics depending on the industry. Housing developers as well. Even though, the specifics of their work should be of interest to us, laws should protect against their bankruptcy in carrying out the investment.

claudiaveja / photo on flickr

claudiaveja / photo on flickr

The first sign that something is wrong is the same as for many other companies, namely the lack of contact, or at least information about that contact can be much more difficult for some reason. If you do not find the information and cannot contact the dealer, it is generally something is wrong. Financial problems can also be seen in the progress of construction work. Delays in the commencement or completion date of  work, or the protracted duration of the investment. Sometimes it even supply of materials are prevented from unspecified reason. Sometimes it is because of the unpaid invoices, which are generally a sign that something is wrong.

You should also take into account the famous saying about rats fleeing a sinking ship. High staff turnover is generally combined with either major changes or mass redundancies, or with employees knowing that the company is going down and they do not intend to be there. Sales may also indicate to us that something is wrong. Significant price reduction or suspension of sale may be the first sign of failure. Reasonable price decrease may be related to the fact that the developer wants for some reason get the money in hand or have access to information indicating a significant drop in property values. Both situations require close examination. Our greatest friend in these situations is the Internet, where we can find a lot of information. While hardly anyone wants to share positive opinions, negative opinions are spread very quickly.

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