What Is Pre-Foreclosure?

Pre-foreclosure refers to the first phase of a legal proceeding that ultimately can conclude in a property being repossessed from a defaulted borrower. The lender files a notice of default on the property in pre-foreclosure because the borrowing owner exceeds the contractual terms for delinquent payments. A notice of default informs the borrowing owner that the mortgage lender is pursuing legal actions toward foreclosure.


Options for Homeowners in Pre-Foreclosure:


• Loan Modification: Renegotiating loan terms with the lender.
• Short Sale: Selling the home for less than the amount owed to avoid foreclosure.
• Paying the Balance: If possible, bringing the loan current.
• Deed in Lieu of Foreclosure: Transferring the home’s title back to the lender.

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