Can I Sell My Home If It’s In Foreclosure in NY?

Foreclosure occurs when a homeowner is unable to make their mortgage payments on time and has no way to catch up on the missed payments. Because a mortgage is a legal agreement between you and your lender, once you’ve defaulted on the loan, the lender can auction off the property to cover any outstanding debts, leaving you homeless and with terrible credit.

If you’ve received a foreclosure notice, it may feel like the walls are closing in. But there’s good news: you can still sell your home, even if it’s already in foreclosure. In fact, selling might be your best option to stop the foreclosure, protect your credit, and walk away with less financial damage.

This guide explains your options and shows you the steps to take—before it’s too late.

No one wants to receive a notice of foreclosure and yet, in a nationwide study, nearly 1 million Americans were afraid of losing their homes (U.S. Census Bureau Household Pulse Survey, fielded from July 27 to Aug. 8, 2022). Foreclosure can occur from a number of reasons, including:

• Job loss and loss of income
• Divorce or death of a spouse or partner
• Mounting debt, including medical and credit cards
• Moving without being able to sell the home
• Natural disaster

Sell My House Fast Buffalo is a local company operating in NY that has built their business by buying distressed houses and properties in the area for cash. They promise competitive cash offers without the hassle of dealing with real estate agents, title companies, traditional bank financing, and more!

What is Foreclosure?

What Is Foreclosure?

Foreclosure is the legal process your lender uses to take back your property when you’ve fallen behind on your mortgage payments. It typically involves these phases:

1. Pre-Foreclosure: You’ve missed payments and received a notice of default. At this stage, you still legally own the home and can sell it.
2. Public Auction: If no action is taken, the lender may schedule a foreclosure sale at a public auction.
3. Bank-Owned (REO): If the home doesn’t sell at auction, it becomes property of the bank.

Key Point: If you’re still in the pre-foreclosure phase, you still have control. Selling the home before the auction can help you avoid the worst-case scenario.Let’s say you or your spouse recently lost your job. You still have the same bills to pay but unfortunately you don’t have the money to cover your expenses, including your mortgage payment. What happens now? Even if you find another job the amount of debt you’ve accrued during that time might be too large for you to pay off in a reasonable amount of time. When this happens, the bank starts the process of foreclosure.

How Long Do You Have To Get Out of Your House After Foreclosure?

The steps for foreclosure in most states are missed payments, public notice, foreclosure, auction, and eviction, but the amount of time for each step varies based on state. You could have anywhere from 120 days to nine months before the bank can foreclose using either a judicial or non-judicial foreclosure. During this time, your lender will reach out to you by phone, mail, and email to let you know about the process.

Can I Sell My Home if It’s in Foreclosure in Buffalo?

If you’re facing foreclosure in Buffalo, you’re not alone—and you still have options. Many homeowners are surprised to learn that yes, you can sell your home even if it’s in foreclosure. In fact, acting quickly might be the key to protecting your credit, preserving equity, and avoiding a full foreclosure on your record.

This guide walks you through how the process works and what steps you can take right now.

Understanding Foreclosure: What It Really Means

Foreclosure begins when a homeowner falls behind on mortgage payments and the lender begins legal proceedings to recover the property. However, this does not mean the home is lost immediately. There’s typically a pre-foreclosure period—often several months—when you still legally own the home and can sell it to satisfy the debt.

Why Selling Might Be the Smartest Move

Selling your home before the foreclosure is finalized can:

• Stop the foreclosure process
• Protect your credit score from the damage of a completed foreclosure
• Help you avoid bankruptcy
• Provide cash (if your home has equity)
• Give you more control over your transition, rather than being evicted by the lender

The Different Types of Foreclosure

There are two different types of foreclosure you may experience: nonjudicial foreclosure or judicial foreclosure.

Steps to Selling a Home in Foreclosure

1. Understand Your Timeline
   Contact your lender or review the foreclosure notice to find out where you are in the process. The sooner you act, the more options you have.
2. Hire a Real Estate Agent Experienced in Distressed Sales
   An agent who knows the foreclosure process in Buffalo can help price the home appropriately and market it quickly.
3. Notify Your Lender
   Let your lender know you’re actively trying to sell. They may pause the foreclosure process while the sale is pending, especially if it will cover the amount owed.
4. Review All Offers Carefully
   Depending on your situation, you may need the lender’s approval (especially if you’re underwater and considering a short sale).
5. Close the Sale Before the Foreclosure Date
   Timing is everything. Your agent and attorney (if involved) will work to expedite the closing so you beat the foreclosure deadline.

What If You Owe More Than the Home is Worth?

In that case, you may need to pursue a short sale, where the lender agrees to accept less than the full loan amount. While this still affects your credit, it’s generally less damaging than a full foreclosure and allows you to move on with more dignity and less financial strain.

Don’t Wait—Take Action Today

If your home is in foreclosure, time is your most valuable asset. The earlier you reach out to professionals, the more likely you are to preserve your equity, protect your credit, and avoid the long-term consequences of a foreclosure.

Need Local Help?
If you’re in Buffalo and facing foreclosure, reach out to a trusted real estate professional who understands your situation. You’re not the first person to go through this, and you don’t have to go through it alone.

How to Sell Your House Before Foreclosure in NY

Let’s break down a few ways you can sell your house, depending on your time frame and situation:

Hire A Real Estate Agent

The first step most Americans think of when selling a house or property is to reach out to a local real estate agent. But there are pros and cons to this option when you are in a difficult situation such as foreclosure. Sure, a good real estate agent can list your property on the MLS and help you get it ready for open houses and daily showings, but they do all of this work so that at the end of the closing process a large chunk of your money from the sale of your house goes to them in the form of the agent’s commission. When you’re already suffering from a mountain of debt and need every penny to pay back your lender, a commission of 3% to 6% of your final sale price may be too hefty an amount to give up.

Plus, there’s the additional fear of not knowing when your house will actually close. Realtors may promise a lot, but at the end of the day you’ll still need to find the right buyer and wait 30+ days for a traditional close. For some homeowners who are facing auction and eviction, even waiting one month might be too long.

Short Sale

If you owe more on your house than it’s worth, your realtor may require what is called a short sale. A short sale is necessary when you owe more on your house than the property is currently worth. For example:  if you owe $200,000 on your house but in the current market it’s only worth $150,000, you must deal with a short sale. Though it may seem like a good option, it won’t be fast or easy.

To start off, you’ll first need to get your lender’s approval. To qualify for a short sale, you must prove financial hardship using documentation such as W-2s, medical bills, etc. For a situation such as loss of income, the lender will require that you prove that the loss of income is long-term and unlikely to turn around in your favor. If the lender approves the short sale, you will need to find a real estate agent and attorney that specialize in short sales, and they will still charge you the same amount as they would if you were selling your house with a traditional home sale.

If your foreclosure hasn’t dragged on for too long and you’ve maintained contact with your lender, it’s likely that they will approve the short sale. This allows them to avoid the time and expense of trying to foreclose on your property, while still recouping some of the loss from the missed mortgage payments. But for the regular American homeowner, the short sale will follow them for the next 5 to 7 years. 

You may have sold the house and been able to pay off some of your debt, but the short sale can damage your credit the same as if you had declared bankruptcy. The credit unions include the delinquency on your mortgage(s) to your lenders and the short sale on their records, making it nearly impossible for previous homeowners to get a credit card, buy a car, or move into a new house or property for the same amount of time as a bankruptcy.

Sell Your House AS-IS to A Cash Buyer

If you’re under a strict time restraint to sell your house before a foreclosure progresses to auction and eviction, you do have options! You can try to sell your property with a real estate agent, work with your lender to complete a short sale, or – best of all – turn to a trusted and reliable cash investor to help you with your situation.

Some of the benefits of selling to a direct cash investor include:

• A quick and pain-free closing process.
• Avoid paying any commissions or fees.
• You won’t have to worry about marketing your house and waiting for a buyer.
• No need to clean-up or complete any repairs!

When you sell your home as-is to a direct cash buyer, you not only can avoid losing your home to an auction, but you also may be able to sell the property for enough money to get out of financial debt. Moving on with your life without the burden of a monthly mortgage payment and debt hanging over your head is one of the best gifts you can give yourself!

Can You Stop Foreclosure Once it Starts?

Sell Your House Fast to a Cash Buyer 

Are you ready to sell your house but don’t have the time to wait 30+ days for a traditional close? Does a short sale seem like a fast way to ruin your credit? Prefer to pay off all your debt at once and get the bank off your back fast? A direct home buyer and cash investor might be exactly the solution you’ve been searching for! When you work with a trusted and reliable investor with a great reputation in your area, you’ll find a helpful company with cash on hand that is ready to purchase your home from your as-is. With a cash buyer, you can skip the lengthy process of foreclosure, eviction, and auction within a matter of days, and save your credit as well!

You may not get full market value for your house or property when you sell to a trusted cash investor, but the timeliness of a fast closing, and the lack of fees, required inspections, and commissions often balance this out at close. Best of all, because an investor can close fast, you can often close before the bank is able to auction off your property! This means you can sell the property for the amount that benefits you versus the pennies to the dollar price the bank will often try to sell your house for just to get it off the books.