It really comes down to a LTV being low enough it will always make sense to the lender, because truthfully get low enough on LTV then it can even flip where default and foreclosure is preferred!

Our method insures one's down payment, and prevents default.

Also you could potentially have recoverability issues down the road if it were to default

pre-foreclosure means a notice of default has been sentforeclosure means a sale date has been setAuction is the actual auctioning of the propertyREO is Real Estate Owned - the bank won the auction  What happens when the bank wins the auction... does it go onto the mls as an reo property?

Can you do it with less - yes but just realize your chances for default go up significantly. 

Over time, most lenders experience a default rate of 1 to 2%.

If the borrowing entity were to default on the loan, the lender will hold each responsible.

If the buyer defaults, the seller finds himself personally liable for payments, or if the default goes far enough, liable payment of the loan balance, on a property he does not own.  

@Justin Sheley @Corey Robinson here is a question that I don't believe has been asked: when you open up the lines of credit do you have to sign a personal guarantor in case one defaults on the payments?

One is for homeowners who are in default and upside down; one is for homeowners who are in default but still have equity in their home; and one is for homeowners who have received Notice of Trustee Sale and their house is about to be foreclosed.