Did you know that? It seems many folks don't. If they did they wouldn't tell me "Your Seller needs to accept my low offer because it's better then being foreclosed on".
Pre-foreclosure means a Notice of Default has been filed. Payments haven't been made and the loan is in default. Foreclosure is imminent. There are many Short Sales on the market where this is not the case.
Being in default IS a requirement on some Short Sales but not all. For example:
- FHA requires the borrower to be 31 days delinquent at time of closing on the PFS (Pre Foreclosure Sale)
- It is also my understanding that the VA requires delinquency prior to qualifying for a VA Compromise Sale.
- To qualify for HAFA a borrower must be delinquent OR default is reasonably foreseeable
Some lender/investors require default and some done. In fact with the new FTC MARS Rule we are not allowed to tell Sellers to miss payments.
So.....don't assume that that Short Sale listing is in foreclosure. It may not be. The Seller could be making payments even though struggling to do so OR it may very well be a Strategic Short Sale.
If you need to sale your property but are current on your mortgage and do not have a hardship you may still be able to do a Short Sale. I hope this helps.
Are you facing foreclosure in Florida?