Can I buy a pre-foreclosure through a regular agent?

Yes. Some owners list their homes with an agent, often as short sales. Others are not listed, and buyers contact them directly. Either way, the owner still controls the sale until the foreclosure is complete.

Is a pre-foreclosure always a short sale?

No. If the home is worth more than the debts against it, the owner can sell at market value and pay off the loan. A short sale is only needed when the sale price will not cover what is owed and the lender agrees to accept less.

How long does pre-foreclosure last?

It depends heavily on the state, whether the foreclosure is judicial or non-judicial, and the lender. Some move in a few months; others take much longer. Always check the current status and any scheduled sale date rather than assuming.

What happens if the auction date arrives before closing?

Unless the lender postpones the sale, the property can be sold at auction and your contract with the owner may become unenforceable. If you are buying through a short sale, ask the lender in writing whether the sale will be postponed while your offer is reviewed.

Buyers and investors who want to purchase a home from an owner who has fallen behind on the mortgage, before it goes to auction.

Buying a Pre-Foreclosure

A pre-foreclosure is a home whose owner has missed mortgage payments and has received formal notice, such as a notice of default or a lis pendens, but whose property has not yet been sold at a foreclosure auction. During this window the owner still holds title and can sell, catch up on the loan or negotiate with the lender.

Buying in pre-foreclosure means working with an owner under financial stress, and often with their lender too if the home is worth less than what is owed and a short sale is needed. Deals can offer more room for inspection and negotiation than an auction, but timelines are uncertain and the rules vary considerably by state.

Pre-foreclosure roadmap

6 steps from first search to keys in hand. Each step has a guide.

Step 1: Understand the pre-foreclosure window
Learn what the notices mean, how the foreclosure process works in your state and what options the owner still has.
Read the guide
Step 2: Find and screen properties
Use public notices and listings to build a list, then check estimated value, loan balances and liens.
Read the guide
Step 3: Contact the owner respectfully
Reach out honestly and without pressure, and make sure the owner understands their alternatives.
Read the guide
Step 4: Evaluate the deal
Inspect the home, estimate repairs and confirm what is owed, including any junior liens.
Read the guide
Step 5: Negotiate with the owner and lender
Agree terms with the owner and, if the sale is short, submit the offer package for lender approval.
Read the guide
Step 6: Close before the sale date
Clear title, close and record the deed before the scheduled auction, with the lender confirming any postponement in writing.
Read the guide

Pre-Foreclosures guides

What Is a Pre-Foreclosure? How the Stage Works for BuyersGuide · 7 min readPre-foreclosure is the window between a lender starting foreclosure and the home being sold at auction. The owner still holds title and still has options, so any purchase is a negotiation with the owner rather than a bid or a bank sale. This guide explains how the stage starts, how it ends and how it compares with auctions and bank-owned homes.How to Find and Screen Pre-Foreclosure PropertiesGuide · 6 min readPre-foreclosure leads come from public filings, so anyone can find them. The real work is narrowing a long list to the few properties worth your time. This guide covers where the filings are recorded, how to use a listing service, and how to screen each lead for equity, timeline and occupancy before you contact anyone.Approaching Distressed Homeowners Ethically in Pre-ForeclosureGuide · 7 min readHomeowners in pre-foreclosure are under real stress, and they have more options than selling to you. Buyers who are honest, respect those options and follow state rules for distressed-property purchases can make fair deals without exploiting anyone. This guide covers how to do that and which patterns to avoid.How to Evaluate a Pre-Foreclosure DealGuide · 6 min readOnce an owner is interested in selling, you can replace rough screening estimates with real numbers. This guide walks through confirming what is owed, finding every lien, assessing condition and repairs, estimating value, and turning those figures into a maximum price you will not go above.How to Buy a Pre-Foreclosure Home: A Step-by-Step GuideGuide · 6 min readBuying a pre-foreclosure means negotiating with an owner who is behind on the mortgage, before the lender sells the home at auction. The deal can close as a normal equity sale or as a short sale that needs the lender's approval. This guide walks through each step, from research to a clean closing through escrow.Closing a Pre-Foreclosure Before the Foreclosure Sale DateGuide · 6 min readIn a pre-foreclosure, the foreclosure sale date is the deadline that matters most, and a signed contract does not move it. This guide covers how to plan the closing backward from that date, keep payoffs and short sale approvals current, seek a postponement properly, meet state rules at closing and protect yourself if the sale date arrives first.

Terms to know

Pre-ForeclosureForeclosure processPre-foreclosure is the period after a lender files a default notice or foreclosure lawsuit but before the property is sold at auction. The owner still holds title and can sell or catch up.Notice of DefaultForeclosure processA notice of default (NOD) is a public notice, recorded with the county, stating that a borrower has fallen behind on a mortgage or deed of trust and that the lender may move toward foreclosure.Lis PendensForeclosure processA lis pendens is a recorded notice that a lawsuit has been filed involving title to or an interest in a property, such as a judicial foreclosure. It warns buyers that the outcome could affect ownership.Short SaleForeclosure processA short sale is the sale of a home for less than the amount owed on its mortgage, with the lender's approval. The lender agrees to accept the reduced proceeds to avoid a foreclosure.ReinstatementForeclosure processReinstatement is bringing a defaulted mortgage current by paying all past-due payments, late fees and foreclosure costs in one lump sum, which stops the foreclosure and restores the original loan.Loan ModificationForeclosure processA loan modification is a permanent change to a mortgage's terms, such as a lower rate, longer term or added past-due amounts, that a lender agrees to so a struggling borrower can afford payments.Deed in Lieu of ForeclosureForeclosure processA deed in lieu of foreclosure is an agreement in which a borrower voluntarily transfers ownership of a home to the lender to settle the mortgage and avoid the foreclosure process.Deficiency JudgmentForeclosure processA deficiency judgment is a court ruling that makes a borrower personally liable for the remaining mortgage debt when a foreclosure sale brings in less than the amount owed.Title SearchTitle & legalA title search is a review of public records to confirm who legally owns a property and to find any liens, judgments, easements or other claims that could affect ownership.Home EquityMortgages & financingHome equity is the portion of a property you own outright: its current market value minus everything owed on it. It grows as you pay down the loan and as the home's value rises.Notice of Trustee SaleForeclosure processA notice of trustee sale is the public notice, in a non-judicial foreclosure, that sets the date, time and place a trustee will auction a property to repay the defaulted loan.Comparative Market Analysis (CMA)Buying & closingA comparative market analysis (CMA) is a real estate agent's estimate of a home's value based on recent sales, pending sales and active listings of similar nearby properties.

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Browse pre-foreclosures across the country on RealtyTrac, with property details, estimated values and foreclosure status.

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Frequently Asked Questions

Disclaimer: The information on this page is for general educational purposes only and is not legal, financial, tax or investment advice. Laws, lending rules and market conditions vary by state and change over time, and any figures shown are estimates. Before you buy, sell, finance or bid on a property, consult a qualified attorney, financial advisor, lender or licensed real estate professional about your situation.