Buying a Pre Foreclosure Home

Preforeclosures are a very good opportunity for both the buyer and seller to benefit. Unlike foreclosure auctions where the former home owner does not benefit, they can actually turn a bad situation into a good one with a pre foreclosure sale.

Preforeclosures are defined as properties owned by people that have received a notice from the lender informing them of the default upon their mortgage payments. The preforeclosure period is classed as that between the issuing of the notice and the auction sale. This is the best time to find a home at a low price.

Home owners (sellers) can benefit by selling their home at pre-foreclosure because:
- They avoid foreclosure
- They may receive enough money for the sale to close out their mortgage
- They can downsize or rent a new property that fits their budget
- Their credit rating stays intact as foreclosure is avoided
- They do not have to go through the stress, pressure and uncertainty of foreclosure

Buyers of pre foreclosure homes benefit greatly because:
- They are helping out people who would have foreclosed otherwise
- They buy a house at a greatly reduced cost
- They have a lot of room to bargain as the sellers are desperate to offload the home which has become a burden on them

As you can see, pre-foreclosures provide great benefits. Although sellers ultimately do not wish to sell their home, it is preferable to going through foreclosure which can ruin not only your bank account but also your self esteem (not to mention your credit rating). People will do anything they can to avoid foreclosure and that includes selling their property below market value.

So where can you find pre foreclosures to buy? Some people actually go door knocking to see if people want to sell their home. But this is a very hit and miss strategy and one that is very time consuming.

You can actually contact your local county court to find preforeclosure properties. You will be able to discover if there are any current Notices of Default. These are the notices that home owners receive when they are close to foreclosure because they have not been paying their mortgage.

Another place to track down pre-foreclosures is through the website Foreclosure.com. They have one of the best databases in the country for those looking to invest in foreclosure and pre foreclosure properties.