How to Sell Your Home in a PreForeclosure Sale

If you are behind on the payments on your home and you won't be able to catch back up, you may be able to avoid foreclosure by working with your lender and real estate agent on a preforeclosure sale. This will allow you to sell your home and avoid having a foreclosure listed on your credit report.

Difficulty: Moderately Challenging

Instructions

Things You'll Need:

• Home
• Current Appraisal
• Contact Information for Lender
• Listing Agreement

1. 
   Contact Your Bank

   ~ Contact Your Lender ~
   
   Whether your house is currently on the market or not, the very first thing you should do it call your lender to discuss the possibility of a preforeclosure sale. Many people want to avoid their creditors when they can't make their payments, but this is the worst thing you can do. Get the phone number for the department that can help you and explain your situation. Tell them that you are specifically interested in selling your home before it a foreclosure takes place.

2. ~ Ask them to email or mail you a copy of their requirements ~
   
   Every bank may be slightly different, but they should all have requirements for preforeclosure sales. For example, you will likely have to list the house at at least 90% of the amount owed, you may have to fill out paperwork, and you'll probably have to provide them with a copy of a current appraisal and your listing agreement. No matter what, you'll want the requirements in writing

3. 
   Complete Banks Paperwork

   ~ Supply the Bank with the Information They Need as Quickly as You Can ~
   
   Your bank will probably need some paperwork from you in order to consider your home for a preforeclosure sale. Get them everything they ask for as fast as you can. You may have to pay for an appraisal at this point. You may also need to supply information about your current bills, income, and other assets.

4. 
   Make Sure Your Home is on the Market

   ~ List Your House or Let Your Agent Know About Your Situation ~
   
   Real estate agents must have an addendum on file if you are not making your payments any longer - it's typically called a distressed property addendum. If your home is already on the market, let your agent know that you are working with your bank on a preforeclosure sale and let them know the bottom price that you'll be able to accept in the sale. If your house is not yet on the market, find an agent that works with clients who own distressed properties.

5. ~ Stay In Contact With the Bank ~
   
   It's wise to contact the bank at least every other week to update them. This will also allow the bank to request additional information. Supply information to them as soon as they request it. If you get an offer on the home, let them know immediately. If the offer is less than what is owed, you may be in a short sale situation and the bank will need to approve the sale. Keep them in the loop as much as possible in order to ensure a smooth transaction.

6. ~

[ScarlettOHairy]

on 6/2/2009 Great step by step instructions on the pre-foreclosure process.