What the word means
Pre-foreclosure is the stretch between falling behind on the mortgage and the foreclosure sale. Depending on the state it can last a few months or several years.
It usually becomes public when the lender records a notice of default or notice of sale, or files a foreclosure lawsuit. That is why letters, postcards and door knocks from buyers often start the same week.
What federal law gives you right now
Your servicer must make good-faith efforts to reach you live, usually by phone, by the 36th day of delinquency and send a written notice about help options by the 45th day. 12 CFR 1024.39.
The servicer may not make the first foreclosure notice or filing until the loan is more than 120 days delinquent. 12 CFR 1024.41(f).
If you send a complete loss mitigation application more than 37 days before a scheduled sale, the servicer may not go ahead with that sale until it has decided your application and any appeal time has run. 12 CFR 1024.41(g).
These rules apply to loans on your main home and to most servicers. Very small servicers are exempt from some of them, and the 120-day rule has a few narrow exceptions, so ask your servicer in writing which rules cover your loan.
The options that exist before a sale
Reinstatement: pay what is past due plus fees and the loan continues. Repayment plan or forbearance: catch up over time, or pause payments for a hardship. Loan modification: change the terms so the payment is affordable.
Sell the house yourself: if you have equity, a normal sale before the auction protects it. Short sale or deed in lieu: if you owe more than it is worth, the lender may accept less or take the deed back.
The letters arriving now
Companies that promise to save your home generally may not charge you anything until you have a written offer from your lender or servicer and have accepted it in writing. That is the federal Mortgage Assistance Relief Services rule, 12 CFR Part 1015. A licensed lawyer who holds your money in a client trust account is treated differently.
Never sign your deed over to someone promising to rent it back and let you buy it later, and never send mortgage payments to anyone but your servicer.
What to do this week
Write down the date you first missed a payment and every notice you have received. Call your servicer and ask for a loss mitigation application. Then call a HUD-approved housing counselor is free on 1-800-569-4287.