Large house with a foreclosed sign out front with text overlay reading “Pre-foreclosure Leads: A Handy Dandy Guide.”

Pre-Foreclosure Leads: A Handy Dandy Guide

Foreclosure, a word that carries a different connotation depending on what it means for you. While not a term exclusive to real estate, a foreclosure occurs when a lender attempts to recover the amount lent to a borrower. They do this by forcing the sale of the asset used as collateral. In real estate specifically, a foreclosure generally occurs when for whatever reason, a homeowner has failed to make their regular payments toward the loan of the property which results in the borrower, usually a bank, seizing the property and forcing a sale to recover the lost revenue. While a foreclosure means the loss of property for the borrower, it can result in great opportunities for an investor.

But, you may be asking, “How do I go about finding one of these foreclosed properties to invest in?” Well, we’re so happy you asked! In this blog post, we’ll discuss how pre-closure leads work, provide some great strategies for finding pre-foreclosure leads, and offer some general advice to keep in mind when making this kind of investment. Let’s get into it!

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How Do Pre-Foreclosure Leads Work?

One of the biggest advantages of finding pre-foreclosure leads and investing in a foreclosure is that a lot of times, the only significant investment you’ll have to make is the acquisition of the property. Quite often, foreclosed homes recently had individuals living in them, which means that you won’t have to invest thousands of dollars in repairs like you would for a fix-and-flip deal. It’s possible that you may be able to buy the property, make any renovations that you would like to, and then turn around and sell it for a profit. Easy right? Yes and no. While it is entirely possible that the process will go smoothly, you have to acquire the property first which is your first task at hand.

Let’s first talk about the basics. A pre-foreclosure lead refers to any property that is beginning to move into the foreclosure process. The buying process for these types of properties works a little differently than buying one in a more traditional way. Still, that doesn’t mean that you can’t begin the acquisition process if you find one that you are interested in. The perk of finding a property in the early stages of the foreclosure process that you can’t acquire just yet is that you will have time to seek funding from a bank or private lender in the meantime.

How Do I Find Pre-Foreclosure Leads?

There’s no set-in-stone way to go about finding leads. As with all real estate investing pursuits, one method to find leads is via networking. As they say, it’s not what you know, but who you know. However, if you’re new to the real estate investing game, or you don’t have many connections in your particular market area, then we recommend checking out our local real estate investor meetings post happening in your area this month here (just scroll until you find the most recent month). However, while networking is a great way to find leads, there are other ways to go about it.

Using Attorneys, Real Estate Agents, and Wholesalers

If you don’t have many connections, then the solution is simple: work with someone who does! Every community has professionally connected individuals within the local market, and who may easily be able to put you in touch with pre-foreclosures in the area. Many homeowners facing potential foreclosures work with attorneys as part of the process. Working with an attorney is a great way to find leads, particularly those that may not be publicly available.

Real estate agents and wholesalers can be great for finding leads in your area, and often may do most of the legwork for you. They will almost certainly have access to attractive listings, and they are bound to be well connected in whatever market area you are interested in. The obvious downside is that there can be significant fees involved, particularly when using real estate agents who may expect a commission as part of the process. Nevertheless, using these professionals can be a great gateway into the real estate investing world. They can help get you started, and once you’ve gained some experience, you can likely begin to find leads yourself!

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Using Public Records and Newspapers

This is a great option for those of you who are more interested in doing the work yourself. Many of the legal proceedings involved in a foreclosure are available to the general public. You can find these via the internet, local news sources, and records through your county recorder’s office. Keep in mind that these records do not necessarily provide all of the information that you will need when making an investment, but they will provide a good place to start finding leads in your local area. At the very least, you should be able to find the address of the property and the name of the owner, and then you can often proceed from there.

If you are trying to complete as much of the process as possible by yourself, keep in mind that there are many laws involved in the traditional foreclosure process, and you will almost certainly want to work with a professional, likely a real estate agent or real estate attorney. Once again, it can be a good idea to work with these individuals to help you get started and you can transition more to doing it by yourself as you gain more experience.

Using Online Services and Directories

Our personal favorite method of finding pre-foreclosure leads is by using an online program or directory (and yes, we’re absolutely unbiased). If you haven’t done so already, create a free MyHouseDeals account here. MyHouseDeals is a great way to search for different types of property deals across the country, and new deals pop up all the time! You can even do this from the comfort of your own home.

Pre-Foreclosures vs. Investor-Ready Foreclosures

It’s important to keep in mind the different types of foreclosures that are available. In this blog post, we primarily focus on pre-foreclosures, or properties in the beginning stages of the foreclosure process. This usually occurs once a borrower has defaulted on three payments, and the lender begins reclaiming the property. Investor-ready foreclosures, on the other hand, are properties that the lender has already reclaimed. Typically, the lender then auctions the property off to the highest bidder.

The competitiveness at foreclosure auctions can make typical foreclosures too expensive to buy the properties at a significant discount. The investor-ready foreclosures on MyHouseDeals are properties that weren’t purchased at a foreclosure auction, and now are bank-owned, similar to real estate owned (REOs). We help you avoid the auctions by compiling a list of all of these properties and filtering out the ones that don’t have room for a profit, so you only see the great deals that are for sale at a significant discount. That’s what makes them investor-ready.


There are numerous other online tools that can serve you in finding pre-foreclosure leads. Some of our favorites include:

  • Probably the most well-known service on this list, Zillow offers tons of real estate listings of all types and can be a great way of finding pre-foreclosure leads.
  • Scours the MLS to find desperate seller listings, investor-ready deals, tax-slashed deals, and investor-ready foreclosures. You can access over 80,000 properties that you won’t find elsewhere.
  • As the name suggests, this site lists various foreclosures perfect for those interested in pursuing this type of investment.
  • Similar to Zillow, this site offers various types of listings available to investors. It can be a great starting place for finding pre-foreclosure leads.


One of the best things about real estate investing is the plethora of different deal types available to investors. While many investors prefer to specialize in a few specific deal types, the most knowledgeable investors are knowledgeable in all different types. It’s important to do a daily check-in for deals and always be on the lookout. We hope that this blog post has enlightened you and provided you with some insight into the investing process.

Best of luck and as always, happy, and profitable, investing!

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Posted on Sep 24, 2021

Author: Alex Farris Soares

Alex is President of MyHouseDeals. Since 2006, he’s worked with real estate investors to bring them the marketing services and training they need to elevate their businesses and reach their goals. Alex is an avid customer advocate, enjoys affecting change in the REI and digital marketing industries, and promotes the values of entrepreneurship and innovation.

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