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Updated about 1 month ago, 10/11/2024
11 Places to Find Foreclosure and Pre-foreclosure Listings
Every serious real estate investor should know how to find foreclosure and pre-foreclosure listings. If you don’t know how foreclosure and pre-foreclosure work, you could be missing out on some potentially great bargains on investment property.
The first step in finding foreclosure and pre-foreclosure listings is knowing where to look. Use this guide to discover the best places to find foreclosures and pre-foreclosures so you can scale your real estate business by purchasing properties below market value.
1. Public Records
In various stages of the foreclosure process, notices are recorded with the county clerk at your county recorder’s office. This information is public record, and anyone can access it.
Just visit your county recorder’s office, where you can search for:
- Notice of default: A notice of default is a letter sent by a creditor informing a property owner they are late on payments. If no action is taken, the property can be sold.
- Lis pendens: A lis pendens is a note issued to a homeowner to let them know that a legal action will take place against them that affects the title to their property. Interested parties can search public records to discover any lis pendens that indicate a home is in the pre-foreclosure stage.
- Notice of sale: A notice of sale informs a property owner that their bank or lender intends to sell their property because they are in default. The note states the time and location of the sale.
The best part of searching public records yourself is that it’s free. The downside to this approach is that it can be time consuming and tedious to find exactly what you’re looking for. However, you’re likely to find newly posted properties that haven’t yet reached online foreclosure data providers.
Public records won’t have pictures of the property, but you can get the address. When you know where the property is located, you can drive by and take a look at it yourself. You won’t be able to see the interior of the property unless no one is living there, in which case you may be able to at least peek in the windows.
2. Online Directories
Performing online searches is quite a bit easier than going to the county clerk or recorder’s office, but you certainly won’t be the first to find out about a pending bank foreclosure. Typically, you’ll need to use an online listing service, where you can either participate in a free trial or pay a fee to view listings. Try checking out the free trial offers so you can see which provider best suits your needs.
There are both national and regional foreclosure listing services that provide notice of default, notice of trustee sale, and lis pendens data on properties in the foreclosure process. Many of these companies will provide information about the property, including the name of the owner, address, loan amount owed, and additional loans outstanding. A select few will also provide contact phone numbers.
3. Local Newspapers
Part of the requirement for filing a foreclosure is that the notice of sale be published in the local newspaper. If you search local papers and business journals, you can easily find notices for trustee sales in the public notice section.
These notices inform the public about upcoming property auctions and list details such as when and where the sale will take place. Today, many local newspapers are available for free or for a small fee online, so you don’t have to purchase the physical newspaper.
4. Asset Managers
You can also find lists of bank-owned properties, or REOs, through asset management companies. These companies help lenders dispose of assets, including properties that have been foreclosed. Many of these asset management companies will list the REO properties they represent on their websites.
5. Government Agencies
Government agencies can also foreclose on properties. Departments like Housing and Urban Development (HUD), Veterans Affairs, and the IRS are just a few of the resources you can use to find foreclosed properties.
Often, these agencies also list upcoming, or pre-foreclosure, properties that are in the process of being foreclosed. You can find out about auctions for single-family homes, multifamily properties, and commercial real estate through government websites. There is no cost to view these listings, but the information can be inaccurate, so it’s important to do your own research.
6. Real Estate Agents
Many real estate investors work with a real estate agent to find foreclosure listings. Because real estate agents work with many homeowners and investors, they often have access to information about pre-foreclosures before the public. A real estate agent is also likely to understand foreclosure proceedings and foreclosure laws, providing invaluable information. Some agents even specialize in foreclosure properties.
In some cases, banks may prefer to facilitate short sales if they believe it will result in a higher selling price than foreclosure. A short sale happens when a homeowner is at risk of default due to financial distress and the bank wants to recover as much money as possible.
Often, short-sale properties are listed below market value, but this isn't always the case. You're more likely to find short-sale listings on the MLS or through real estate agents because these aren't REO properties.
7. Bank Websites
Bank websites are another good place to find foreclosure listings. Banks foreclose on properties when owners fail to pay their mortgages.
Although banks prefer a homeowner to avoid foreclosure, lenders will take possession of and then sell a property if the owner falls too far behind in making payments. Each bank has a different website, so you may have to search for foreclosures using the search function on these sites.
8. Real Estate Attorneys
People hire real estate attorneys for a variety of reasons, including to help them get rid of properties they can’t afford or don’t want. This can make them a great resource for finding pre-foreclosure listings.
These attorneys represent clients who want to avoid foreclosure. So investors who want to sign a contract on a property before it even hits the market can benefit from networking with real estate attorneys. They may have access to leads who are interested in selling their property at a low price just to get rid of it.
9. Auction Houses
You may be able to find pre-foreclosure listings through auction houses. Because many foreclosure homes are sold through an auction company, these companies may have access to pre-foreclosure listings.
Once an auction is scheduled for a home, it's past the pre-foreclosure stage. However, auction houses may have advanced knowledge of homes that are in the process of being foreclosed upon, which could help you purchase an investment property at a low price before it becomes an REO.
10. Neighborhood Drive-by
Doing a neighborhood drive-by to look for foreclosures may seem like a dated approach, considering how easy it is to search online. But driving through neighborhoods is something to consider.
As you drive through an area, look for notices posted on doors that indicate a home is in pre-foreclosure or foreclosure. A home at risk of foreclosure might also have a for sale sign in the yard that indicates the homeowner is distressed.
Additionally, you may see a home that appears vacant or in disrepair. These homes may have tax liens or other issues that could lead to foreclosure in the near future. Pay the owner a visit to see if they’ll sell the home before foreclosure happens.
11. Real Estate Wholesalers
A real estate wholesaler is someone who facilitates deals between homeowners and investors or buyers. They typically look for distressed properties that need to be sold quickly to avoid foreclosure. Sometimes these homes are already in pre-foreclosure.
Real estate wholesalers buy contracts and then sell them to people who are interested in buying a property, usually at a discount. Their services can help stop foreclosures from happening, and you can still get a great deal on an at-risk property.
Final Thoughts
While the number of foreclosures today is nowhere near what it was during the 2008 housing crisis, there are still plenty of opportunities for savvy investors to find great deals when they know where to find pre-foreclosure listings, as well as information about REO properties and homes that are in foreclosure. Regardless of your real estate investing strategy, pre-foreclosure properties can be an excellent way to purchase real estate at a low price.
This post originally appeared on the BiggerPockets blog.
Quote from @Account Closed:
Every serious real estate investor should know how to find foreclosure and pre-foreclosure listings. If you don’t know how foreclosure and pre-foreclosure work, you could be missing out on some potentially great bargains on investment property.
The first step in finding foreclosure and pre-foreclosure listings is knowing where to look. Use this guide to discover the best places to find foreclosures and pre-foreclosures so you can scale your real estate business by purchasing properties below market value.
1. Public Records
In various stages of the foreclosure process, notices are recorded with the county clerk at your county recorder’s office. This information is public record, and anyone can access it.
Just visit your county recorder’s office, where you can search for:
- Notice of default: A notice of default is a letter sent by a creditor informing a property owner they are late on payments. If no action is taken, the property can be sold.
- Lis pendens: A lis pendens is a note issued to a homeowner to let them know that a legal action will take place against them that affects the title to their property. Interested parties can search public records to discover any lis pendens that indicate a home is in the pre-foreclosure stage.
- Notice of sale: A notice of sale informs a property owner that their bank or lender intends to sell their property because they are in default. The note states the time and location of the sale.
The best part of searching public records yourself is that it’s free. The downside to this approach is that it can be time consuming and tedious to find exactly what you’re looking for. However, you’re likely to find newly posted properties that haven’t yet reached online foreclosure data providers.
Public records won’t have pictures of the property, but you can get the address. When you know where the property is located, you can drive by and take a look at it yourself. You won’t be able to see the interior of the property unless no one is living there, in which case you may be able to at least peek in the windows.
2. Online Directories
Performing online searches is quite a bit easier than going to the county clerk or recorder’s office, but you certainly won’t be the first to find out about a pending bank foreclosure. Typically, you’ll need to use an online listing service, where you can either participate in a free trial or pay a fee to view listings. Try checking out the free trial offers so you can see which provider best suits your needs.
There are both national and regional foreclosure listing services that provide notice of default, notice of trustee sale, and lis pendens data on properties in the foreclosure process. Many of these companies will provide information about the property, including the name of the owner, address, loan amount owed, and additional loans outstanding. A select few will also provide contact phone numbers.
3. Local Newspapers
Part of the requirement for filing a foreclosure is that the notice of sale be published in the local newspaper. If you search local papers and business journals, you can easily find notices for trustee sales in the public notice section.
These notices inform the public about upcoming property auctions and list details such as when and where the sale will take place. Today, many local newspapers are available for free or for a small fee online, so you don’t have to purchase the physical newspaper.
4. Asset Managers
You can also find lists of bank-owned properties, or REOs, through asset management companies. These companies help lenders dispose of assets, including properties that have been foreclosed. Many of these asset management companies will list the REO properties they represent on their websites.
5. Government Agencies
Government agencies can also foreclose on properties. Departments like Housing and Urban Development (HUD), Veterans Affairs, and the IRS are just a few of the resources you can use to find foreclosed properties.
Often, these agencies also list upcoming, or pre-foreclosure, properties that are in the process of being foreclosed. You can find out about auctions for single-family homes, multifamily properties, and commercial real estate through government websites. There is no cost to view these listings, but the information can be inaccurate, so it’s important to do your own research.
6. Real Estate Agents
Many real estate investors work with a real estate agent to find foreclosure listings. Because real estate agents work with many homeowners and investors, they often have access to information about pre-foreclosures before the public. A real estate agent is also likely to understand foreclosure proceedings and foreclosure laws, providing invaluable information. Some agents even specialize in foreclosure properties.
In some cases, banks may prefer to facilitate short sales if they believe it will result in a higher selling price than foreclosure. A short sale happens when a homeowner is at risk of default due to financial distress and the bank wants to recover as much money as possible.
Often, short-sale properties are listed below market value, but this isn't always the case. You're more likely to find short-sale listings on the MLS or through real estate agents because these aren't REO properties.
7. Bank Websites
Bank websites are another good place to find foreclosure listings. Banks foreclose on properties when owners fail to pay their mortgages.
Although banks prefer a homeowner to avoid foreclosure, lenders will take possession of and then sell a property if the owner falls too far behind in making payments. Each bank has a different website, so you may have to search for foreclosures using the search function on these sites.
8. Real Estate Attorneys
People hire real estate attorneys for a variety of reasons, including to help them get rid of properties they can’t afford or don’t want. This can make them a great resource for finding pre-foreclosure listings.
These attorneys represent clients who want to avoid foreclosure. So investors who want to sign a contract on a property before it even hits the market can benefit from networking with real estate attorneys. They may have access to leads who are interested in selling their property at a low price just to get rid of it.
9. Auction Houses
You may be able to find pre-foreclosure listings through auction houses. Because many foreclosure homes are sold through an auction company, these companies may have access to pre-foreclosure listings.
Once an auction is scheduled for a home, it's past the pre-foreclosure stage. However, auction houses may have advanced knowledge of homes that are in the process of being foreclosed upon, which could help you purchase an investment property at a low price before it becomes an REO.
10. Neighborhood Drive-by
Doing a neighborhood drive-by to look for foreclosures may seem like a dated approach, considering how easy it is to search online. But driving through neighborhoods is something to consider.
As you drive through an area, look for notices posted on doors that indicate a home is in pre-foreclosure or foreclosure. A home at risk of foreclosure might also have a for sale sign in the yard that indicates the homeowner is distressed.
Additionally, you may see a home that appears vacant or in disrepair. These homes may have tax liens or other issues that could lead to foreclosure in the near future. Pay the owner a visit to see if they’ll sell the home before foreclosure happens.
11. Real Estate Wholesalers
A real estate wholesaler is someone who facilitates deals between homeowners and investors or buyers. They typically look for distressed properties that need to be sold quickly to avoid foreclosure. Sometimes these homes are already in pre-foreclosure.
Real estate wholesalers buy contracts and then sell them to people who are interested in buying a property, usually at a discount. Their services can help stop foreclosures from happening, and you can still get a great deal on an at-risk property.
Final Thoughts
While the number of foreclosures today is nowhere near what it was during the 2008 housing crisis, there are still plenty of opportunities for savvy investors to find great deals when they know where to find pre-foreclosure listings, as well as information about REO properties and homes that are in foreclosure. Regardless of your real estate investing strategy, pre-foreclosure properties can be an excellent way to purchase real estate at a low price.
This post originally appeared on the BiggerPockets blog.
- Chris Seveney
#3 Foreclosures Contributor
- Paradise, CA
In my opinion, the first step is understanding the vernacular more so than where to look. I think this is generally a good post but, a couple of subjects warrant comment (opinion...which yes, I know how valuable anyone's opinion may or may not be).
* In my world (Bank) a "Foreclosure" is a property/loan that has a filed notice (Often referred to as first legal) that a foreclosure has commenced and is somewhere in the foreclosure process between first legal and sale (or post sale redemption).
*In my world, a "Pre-foreclosure" is a property or loan where the first legal has not been filed. It is delinquent enough (Greater than 90 days but below 120 days(can't file first legal until after the 120th day by federal rule (Except under very very specific circumstances)) to where the lender or servicer has sent the breach letter (Notice of pending foreclosure) with an expiration date that the loan will be referred to a foreclosure filing (Trustee/attorney) if the borrower(s) don't cure the breach within that defined period of time.
* A notice of default is not a letter sent by a creditor saying they are late. It is actually the legal filing that there is a recorded foreclosure process that has already started, after the expiration of the letter that was sent informing of the lates and consequences of no action.
* lis pendens is not just a note but a recorded cloud on title that there is pending litigation. Lis pendens are not typical in trustee states because trustee states use the power of sale clause to foreclose, and don't use the courts.
*Online Directories are only available for or useful for loans/borrowers in an active foreclosure where there has been a public filing in court or the recorder's office. Delinquent loans under 120 days, are not public information for anyone.
*Asset Managers manage foreclosed (past tense), not foreclosure (Pending sale/auction) properties. Those are called "REO"(Real Estate Owned) (as you pointed out), not foreclosures.
*Short sales don't exist today. 2016? Sure. 2024? Maybe in Jersey but nowhere else (I'm being somewhat sarcastic about Jersey). Short sales are where the bank would realize a lesser loss settling than they would completing a foreclosure. It's usually a financial distress but not always. For example, a soldier changing duty station could do a short sale without any hardship whatsoever. Short sales by design are listed on MLS (always and always are arms length) and not below value, or the lender would more than likely decline any short sale offer.
*Banks don't list foreclosure listings on their websites. REO properties? You bet, but not active or pre-foreclosure.
*Real Estate attorneys are a waste of time if you are looking for foreclosures. Using one to go under contract is fine but using (networking) one to find a foreclosure? Highly unlikely except in a probate or estate type of scenario.
*Auction Houses are good for finding active foreclosures and REOs (Bank owned). If you agree with my definition (I'm not insisting you do) of "pre foreclosure", you wouldn't find pre-foreclosures at an auction house.
*Neighborhood drive bys could get you shot. Drive slow up/down the wrong street looking like you aren't from there could get the cops called on your or worse. You won't see a notice for a preforeclosure. Any required notice would be removed quickly (usually) if occupied.
I highly recommend against this tactic as you are going to swing a bat at a hornets nest or worse, knocking on their door. You may also run afoul of local/state laws against people that contact people in foreclosure to buy their home.
*Wholesalers are often people that don't have the financial wherewithal to do the deal themselves, so they try to get others to help and call themselves wholesalers. Yes, I know there are legitimate wholesalers but just like used car salesmen (women), the bad ones make the good ones seem just as bad. They don't usually stop foreclosures and usually blow things up instead.
