Pre-Foreclosure Process - What is the Crucial Stage in Foreclosure?

What is the pre-foreclosure process and why is this an important stage in the foreclosure process? Well, pre-foreclosure is nothing more than a grace period during which the lender warns you that you are in default and that you need to do something about the delinquency of your mortgage loan or they can proceed with foreclosure proceedings.

Here's how it works: You are a month or two behind on your mortgage payment. There are many reasons this happens, but for some, it becomes unavoidable. The lender will initially file a Notice of Default. This of course is filed publicly with your state and starts the actual foreclosure process. At this point, your property cannot be seized or sold by the lender to recoup their losses.

The pre-foreclosure period is the best time for you because this gives you the opportunity to work out the differences with the lender in order to salvage your credit, catch your mortgage back up to current, and resume payments, essentially keeping your family in your home.

The length of time for this pre-foreclosure grace period varies from state to state based on your current state laws. Some states allow up to 6 months of pre-foreclosure time before they file a Lis Pendens or legal action pending against your property, at which point your home is in foreclosure.

Once the property enters pre-foreclosure process, there are a number of ways you can avoid having your property foreclosed on you forced onto the street.