What is a Zillow Pre-Foreclosure? In Utah, if you get a notice of default, meaning you have missed a mortgage payment, that is made public record. As soon as a notice of default is sent in the mail, anyone can find it.
Zillow goes through local county records to see who has gotten a notice of default, which can happen as soon as 30 days after a missed a payment.
Zillow will take this information and advertise it as a ‘pre-foreclosure’, which really just means that they were late on the payment. And, as you would guess, merely being late on a payment does NOT mean that someone will lose their home.
If you look at their pre-foreclosures before and after the 15th of the month, you’ll see that there are far more pre-foreclosures AFTER the 15th because that’s often when notices start going out.
The prices they predict are usually very, very off as well.
For example, if someone had purchased a $300,000 home using a $100,000 down payment 15 years ago, their mortgage would show a balance of around $120,000. That $120,000 is the price Zillow would quote as the pre-foresloure price. However, IF that house actually went into foreclosure (unlikely since the home-owners would have so much equity in their home and would want to sell it first!), Zillow would try to sell that home for full market price at $300,000 to recoup ALL losses, such as lawyer and attorney fees.
So, as you can see, Zillow’s pricing on their ‘pre-foreclosures’ can be really off!
Zillow’s end game is to get your contact information and sell it to other Realtors. Save yourself the hassle of being contacted by someone you don’t know or trust and contact me with any questions you might have. I’m always here for anything you need!