When is it too late to tie up a Pre Foreclosure deal?

[John Payne]

Learning more and more about Pre Foreclosures and Notice of Defaults, but one nuanced question. Whether paying cash or taking the property subject-to, the overdue lien that is causing the foreclosure in the first place needs to be wiped out.  Assuming you do your due diligence, it meets your criteria, and the seller agrees, at what point is it too late to intercede to gain control of the property before the lien holder does?

[Nick G.]

Depends entirely on how fast you can close escrow on it, which relies heavily on having solid title/escrow companies and solid communication with the foreclosing lender. Once the foreclosing lender files an NOD, they can file a Notice of Trustee Sale after 90 days. Once an NOT is filed, they can foreclose once another 27 days goes by, so the clock is really ticking at that point. After an NOT is filed, you have to assume they'll be foreclosing on day 28. Therefore, hopefully you'll have started talks with the bank prior to one week left of that countdown. Seven days (which may really just be five business days) is pretty darn tight to start calling the lender to start arranging a payoff. It's doable, but it's probably going to feel pretty stressful.