{"id":23603,"date":"2024-12-11T01:38:38","date_gmt":"2024-12-11T09:38:38","guid":{"rendered":"https:\/\/www.homelight.com\/blog\/?p=23603"},"modified":"2024-12-12T16:52:37","modified_gmt":"2024-12-13T00:52:37","slug":"buyer-buying-a-preforeclosure","status":"publish","type":"post","link":"https:\/\/www.homelight.com\/blog\/buyer-buying-a-preforeclosure\/","title":{"rendered":"9 Tips for Buying a Preforeclosure (Especially If It\u2019s Your First)"},"content":{"rendered":"

So you\u2019re thinking about buying a house, and you start looking around online \u201cjust to see what\u2019s out there.\u201d As you\u2019re getting familiar with the lay of the land \u2014\u00a0 eyeballing homes that seem to meet your criteria and fit your budget<\/a>, daring to let yourself feel excited about the possibilities \u2014 maybe you stumble upon a listing marked as a \u201cpreforeclosure.\u201d<\/p>\n

The photos show a home that looks like it\u2019s in good shape, and the price is neither suspiciously low nor alarmingly high. So what\u2019s the deal? What does preforeclosure even mean?<\/p>\n

Before you rush into (or out of) anything, let\u2019s slow down and take a look at what you need to know about buying a home in preforeclosure. With the help of top agent and San Francisco Bay Area real estate expert Rick Fuller<\/a>, we\u2019ll cover nine important tips for shopping for and purchasing a preforeclosed home.<\/p>\n\n\n\n\n\n

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<\/div>1. Understand what preforeclosure means<\/h2>\n

As the term implies, the home in question is approaching foreclosure<\/a>. The homeowner is behind on mortgage payments<\/a>, and while they do still have an opportunity to catch up before the bank seizes the property, an official notice of default has been issued.<\/p>\n

Because notices of default are public documents recorded with the county, this information is now public. \u201cIt doesn\u2019t tell you by how many payments; it just means that there\u2019s an official notice that this homeowner, this borrower, is in default,\u201d says Fuller.<\/p>\n

<\/div>2. Know the difference between preforeclosure and short sale<\/h2>\n

At first glance, there may seem to be parallels between a home in preforeclosure and a short sale property, but the two are very different.<\/p>\n

\u201cThe nature of a short sale<\/a> is that the homeowner owes more than what the home is worth. We might also say that they\u2019re \u2018underwater,\u2019\u201d explains Fuller.<\/p>\n

\n If they were to sell the property, they would have no proceeds and would in fact owe the lender or the lienholder money at the time of closing.<\/q>\n
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