What are the differences between foreclosure and pre-foreclosure?

Foreclosure and pre-foreclosure are two different processes that involve a homeowner who has fallen behind on their mortgage payments. In Arizona, foreclosure is the legal process that is initiated by a lender to repossess a property because of defaulted payments. Pre-foreclosure is the process that typically comes before foreclosure, in which a lender tries to reach a mutually agreeable solution with the homeowner in order to avoid foreclosure. For a foreclosure to take place in Arizona, the lender must file a Notice of Trustee’s Sale (NTS) with the recorder’s office in the county where the home is located. Once the NTS has been filed, the foreclosure process will typically take anywhere from four to six months before the home is repossessed by the lender. In pre-foreclosure, the lender will usually contact the homeowner and offer options such as loan modification, forbearance, or short sale in an attempt to avoid foreclosure. During a loan modification, a lender will work with the homeowner to modify their loan in terms of length, interest rate, or principal balance so that the homeowner can become current on their mortgage and avoid foreclosure. In a forbearance, the lender agrees to postpone or reduce some monthly payments in order to help the homeowner become current on their mortgage payments. With a short sale, the lender agrees to accept less money than is owed on the loan in order to avoid foreclosure. In conclusion, foreclosure and pre-foreclosure are two different processes in Arizona that involve a homeowner who has fallen behind on their mortgage payments. Foreclosure is a legal repossession process initiated by the lender, while pre-foreclosure is the process in which a lender tries to reach a mutually agreeable solution with the homeowner in order to avoid foreclosure.

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What are the differences between foreclosure and pre-foreclosure?

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