What is an Abandonment?

Abandonment is a voluntary action whenever the property is in a state in which the the costs or it's worth is higher then the mortgage, in this case the owner can give up his claim on the property. After this has been done a new occupier can claim it or the government can take it over. Important note that any obligations concerning the estate like taxes, outstanding debts are handled by the owner. Also abandonment can happen when a company has assets which don't produce any profit and decides to cut his losses then abandonment is the best option. After proper legal work has been done then it can be abandoned. In case of an insurance, for example a customer insures a boat house and it sinks or obtains damage which costs more then the whole value of the boat then he can abandon the wreckage.