Pre-foreclosure properties show up on public records when a lis-pendens (notice the lender intends to foreclose at a future date) is filed. Many of the Internet sites report these homes as pre-foreclosure due to the recording of the lis-pendens.

Not all lis-pendens result in a foreclosure. Many home owners working on a loan modification or who have a payment arrangement with the lender will have a recorded lis-pendens and considered as pre-foreclosure until the modification is approved and closed. The lis pendens will also remain acitve until a payment arrangement brings the debt current or a short sale clears the pubic records. This process can take several months or in some cases years.

A pre-foreclosure is actually a Short Sale. If the owner and lien holder can be convinced to sell the home for an amount less than owed the result is called a Short Sale. There is a process and protocol. This process takes several months.

The owner's mortgage information is protected under the privacy act therefore the mortgage company will not discuss any pre-foreclosure /delinquent properties with anyone but the home owner or their designated Power of Attorney. The home owner still owns the home and must sign any contract to purchase as well as qualify with their lien holder for a hardship sale.

You should contact a local Realtor who works with Short Sales to assist you if you want to consider pre-foreclosure properties. If you have additional questions about the process, contact me.

If you are working with a real estate agent, they will most likely have someone they can refer you to. If you are not, check with several local banks. Most handle pre-foreclosures and have different programs to fit your needs. Compare at least two or three so that you know you are getting the best deal for you!