Pre-Foclosure?

Question

Can someone define pre-forclosure to me, amd why this is better than forclosure. Where can i find information on pre-foclosures? Thanks

Jim Watkins · Answer

With no disrespect to Nate in my reply...
I am an expert in this field (I stress TEXAS is my area I claim expert status in) and there is a BIG difference between a "pre" foreclosure and a "Foreclosure" as you worded it.
The term Foreclosure is the legal process a lender must take to legally repo a house. Actually they are taking the "title" back from the owner.
The term "pre" foreclosure (depending on the state) is the time period a lender must go through where the foreclosure process is actually a public record, up to the date the lender legally obtains title to the property.

So the correct terms would be:
Pre-foreclosure - Public notice has been filed where the lender initiates reoposession of TITLE from the current homeowner.

Foreclosure - After a lender has completed the legal process and they now hold the title and are the legal owners. (Remember houses with FHA & VA loans end up going to HUD)

Nate Roman · Answer

I can help you with part of your question.  Pre-foreclosure happens before the actual foreclosure process.   I'd try to explain, but I'm no expert.  They actually have a good article that should help to answer your question here: http://www.biggerpockets.com/buy-pre-foreclosures.html