The Truth About Zillow Pre Foreclosures
There are LIES everywhere you look in real estate - even websites! In this video, I share the TRUTH about Zillow pre foreclosures and Zillow foreclosures. So let’s get to it!
Hi, I’m Heather Wright with RE/MAX Concepts. I’m a REALTOR in the Des Moines area and I don’t know about you, but I really hate being lied to. (And actually, I’m sure you don’t like it either!)
So, let’s talk about the TRUTH when it comes to foreclosures and pre-foreclosures on Zillow.
First of all, I think Zillow is a great website. People in general really love the website and how easy it is to use.
The purpose of this video is not to take away from that, but just to bring some clarity on exactly what it is you're seeing on Zillow.
I get too many calls from people who are really interested in this "amazing deal" they saw on Zillow listed as a foreclosure or a pre foreclosure. And then they're disappointed (and sometimes upset with me) when they find out that in fact, it's not for sale.
Like most companies, Zillow’s goal is to make money. Of course, we all want to make money at our job, right? So they make money by selling advertising space to real estate agents, and they sell that space based on page views or visits to their website.
The more often they can get you or anybody else to visit their website, the more chances they'll have at selling that spot to a real estate agent, therefore making more money.
So a few years ago, one of the new features that Zillow added to their site enticing people like you to keep coming back and looking at more were foreclosures and pre foreclosures.
Of course, foreclosures and pre foreclosures are really tempting because everybody wants to get a DEAL.
But the fact is in today's market (this was filmed in 2020) that's just not the case.
So let's take a look at exactly what it is that you're seeing when you are searching for homes on Zillow.
So let's say you're looking for properties for sale in Des Moines you type in Des Moines. And all the properties show up in this section where it says for sale, you can be more specific about what you're looking for. You'll click on for sale and expand that menu.
And there's options that are pre selected automatically by Zillow. You've got by agent, coming soon, by owner, auction, new construction, foreclosures, and then see there's a little line right there and then it's a whole other section foreclosed and pre foreclosures.
Let's click on the little question mark to find out exactly what secret message they have to tell us.
Of course, foreclosures are properties that are owned by a bank or a lender who took ownership through foreclosure proceedings. They may SOON be listed for sale. These properties are not found on a multiple listing service.
The pre foreclosures option has a similar message. The lender initiated foreclosure proceedings on these properties because the owners were in default on their loan obligations.
Pre foreclosures also include properties for which a foreclosure auction is scheduled. These properties are not found on a multiple listing service.
A lot of times people will call me and say, Hey, I saw this amazing house listed for sale on Zillow. And as a real estate agent, I automatically look that house up on the multiple listing service, the MLS, which is a tool that real estate agents have available to them.
And of course, if the property does not show on the MLS, my first thought is, I bet they found this on Zillow. And sure enough, they say, "Oh, yeah, it's a foreclosure and it looked like a good deal."
This is the lie about Zillow.
They get you excited about properties that are not actually for sale.
When will it be for sale? Maybe one day, maybe soon, maybe not soon, maybe, maybe, maybe maybe it might come on the market.
I don't know about you, but I don't really like to live my life based on a lot of maybes.
If a foreclosure is actually available for sale, it will show up in that section above that says foreclosures, because those are actually for sale. And it will say for sale on it.
Pre foreclosures are a little more complicated. A house may have a notice of foreclosure that was filed and it's public record and could have been a clerical error.
MAYBE they got behind on a couple of payments on their mortgage, and they've since been able to catch back up.
MAYBE the owner of that home took out a loan from their family to pay back the past due amount on their mortgage.
MAYBE they modified their loan or refinanced completely.
Or MAYBE they sold it last year. And the information you're looking at is stale.
So now you know:
if a property is listed as a pre foreclosure or a foreclosure, then it is not actually for sale.
It's fun to look at those properties, but try not to get super excited about those because you know, MAYBE, one day it will be for sale.