A lis pendens notice is filed by a lender when a homeowner is late on mortgage payments or has a tax lien. It can be an opportunity for buyers to purchase a home for a low price, but homeowners can still stop the foreclosure process by working out a repayment plan with the lender or selling the house. Investors often look for lis pendens foreclosures, but they need to act quickly as homeowners can still save their home in the early stages of foreclosure.
A lis pendens notice means that the foreclosure process has begun on a home, as landlords are late on mortgage payments or have a tax lien that requires the home to be sold to pay the money owed. The lender typically files this notice, and then the county registrar usually attaches it to the home title, making its status publicly visible since this is public information. What lis pendens foreclosure means to home buyers is that they can have the opportunity to buy the home for a low price. In fact, many investors look specifically for lis pendens foreclosures, as their goal is to buy them cheap and then sell them for more money in the future. On the other hand, a lis pendens foreclosure notice gives current homeowners the option to stop the foreclosure if they are not ready to lose their home, as this is only the first step in a long process.
When homeowners are past due on mortgage payments, the lender often contacts them to attempt to pay off the debt as soon as possible. If homeowners are unresponsive, or have no way to make payments, the lender typically files a lis pendens notice, officially starting the foreclosure process. Since this is usually affixed to the title by the county registrar, it can prevent homeowners from attempting to refinance the loan or sell the home without first checking with the lender.
Of course, homeowners typically can still stop lis pendens foreclosure, as it could be months or even years before the home is auctioned off. One of the most common options is to work out a repayment plan with the lender, who usually takes the home off the market for foreclosures once they are assured they will get their money back from the owners. It is also often possible for the owners to sell the house with the intention of giving the proceeds to the lender, although of course this requires the current occupants of the house to move out. Those who can’t afford to move or start paying mortgages can at least delay lis pendens foreclosure by filing for bankruptcy, although this fix is only temporary.
Many investors are eligible for a lis pendens foreclosure since it is the first sign that a home is on the market for little money. Such investors are constantly on the lookout for properties they can buy, fix, and then sell for more than they paid, so a lis pendens notice can be a good thing. Of course, because homeowners can still save their home in this early stage of foreclosure, investors may need to act quickly when showing their interest in the property.
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