Pre-Foreclosures Explained

A “Pre-foreclosure” is the term referred to by mortgage lenders as the time period from when the lender notifies the borrower that they have defaulted on a payment, and when the sale of the property to the lender at an auction is finalized. Pre-foreclosure sales can be an option to borrowers who need to pay off their mortgage. The United States Department of Housing and Development has organized the Pre-foreclosure Sale Program which allows the borrower who has defaulted on payments to sell the house, and use the profits from the sale to pay off the mortgage debt.

This can mean great news to prospective homebuyers. When the borrower is looking to sell his house, they are looking to sell their property for either at least 63% of their outstanding debt, or 82% of estimated sales proceeds, and they are in a hurry to sell so delinquent payments do not accumulate. This usually results in properties that are priced to sell, and sellers who are in a hurry to sell them. These purchases can be great deals for first time buyers, and such purchases, just as the large percentage of properties out there, are applicable to have a FHA loan taken out on them.

The easiest way to avoid pre-foreclosure, or foreclosure in general is to make your mortgage payments on time, and never to default. MortgageLoanPlace.com offers the service of finding great FHA loans, among other types of loans, which are perfect for first time, or repeat homebuyers. Finding a payable loan that works for you is easy with thanks to our helpful customer service representatives, and our database of frequently asked questions. Visit our loan pages, and you’re next loan is just a few clicks away.