Pre-Foreclosure

Pre-foreclosure refers to the initial part of a judicial procedure that might ultimately result in the repossession of a property from a defaulted borrower. The lender files a notice of default on the property in pre-foreclosure because the borrower's payment terms have been exceeded.

A notice of default informs the borrower that the lender intends to initiate foreclosure proceedings. If they find themselves in pre-foreclosure, borrowers have several options open. Lenders may even be ready to bargain with borrowers to prevent foreclosure.