Three Basic Stages of Foreclosure

PRE-FORECLOSURE: Actions include deed in lieu of foreclosure, quit claim deed, forbearance agreement, cash for keys, short-sale, and reinstatement of the mortgage. The initial step against a homeowner comes in the form of a 'Liz Pendens' which is a filing for court action. This is the notice to the public that there is litigation pending in regards to a subject property and essentially stops any sale or conveyancing of the property.

FORECLOSURE: Open bidding by prospective buyers at sheriff's auction. Most liens against a property will be extinguished after this action.

POST-FORECLOSURE: Since most lenders will not let their property get out of their control, most properties going though foreclosure end up being owned by the lender. At this time the property becomes a liability on the books, and the lender will hire a Real Estate Broker to list and sell the property.