Some Listings on Zillow Are Not For Sale And Never Will Be
Have you ever heard the term “pre-foreclosure listings?” If you’re a first-timer, you’re likely to find a pre-foreclosure listing.
When you perform a search on Zillow for homes for sale, the results you get may include some houses that are not actually for sale!
In a strange situation that is increasingly frustrating for Realtors, Zillow includes listings considered in “pre-foreclosure” status. These are Zillow property listings that aren’t actually for sale and may never be for sale.
Unfortunately, these Zillow pre-market listings cause potential home buyers unnecessary confusion and false hope.
These results are misleading to prospective home buyers and leave real estate agents explaining what is and what is not available from the search results produced by Zillow.
While Zillow provides some excellent real estate data points and offers a pleasing presentation for buyers on their site, having inaccurate information quite frankly sucks!
Just like inaccurate Zillow estimates of value, having misleading information on their site offers little value to consumers.
Real Estate agents know all too well it can be frustrating to have to explain over and over to both buyers and sellers why you cannot possibly expect an online tool to accurately predict the value of millions of homes around the country.
That is a preposterous notion. You have better odds of seeing Big Foot than an accurate Zillow home value.
Zillow pre-foreclosure listings are also misleading to buyers and should be done away with. There is ZERO value in this.
What Are Pre-Foreclosure Listings?
A pre-foreclosure listing is a property that the current owner has missed mortgage payments. They have also passed their grace period without making a mortgage payment.
The lender who has the mortgage will send out a notice of default to the property owner When this happens.
The default notice will explain the owner has missed mortgage payments, and if they don’t become current legal action will be taken. The foreclosure process will commence if the homeowner does not become current on their loan balance.
A Lis Pendens will be filed at the local registry of deeds stating a lawsuit against the property’s current owner. Notice will be made in public records such as local newspapers of the lender’s intention to foreclose.
Eventually, foreclosure proceedings will take place with an upcoming foreclosure auction. Quite often, a public auction will take place on the foreclosed home.
Short Sales Are Better Than Foreclosure Homes
Sometimes a homeowner may work with local real estate agents to short sale their property before foreclosure.
Most real estate professionals will recommend a short sale over becoming a foreclosure home. A short sale is the best way to negotiate mortgage debt removal when you run into financial problems. Short sales are favored over foreclosure homes by many lenders because of the expense of going through the process of foreclosure.
The property will need to be sold close to market value on the open market, determined by the lender’s real estate appraiser. Real Estate investors are often attracted to short sales and a pre-foreclosure because they are distressed properties with good value.
What Are Zillow Pre-Foreclosure Listings?
Now that you know what a pre-foreclosure listing is, you’ll begin to understand the problem with Zillow pre-foreclosure listings. A pre-foreclosure listing on Zillow may never become a foreclosed property! Zillow foreclosures are rare.
Most of the potential foreclosure homes on Zillow are never foreclosed on. The current homeowner becomes current with their mortgage.
As a Realtor, I get phone calls all the time from excited buyers about homes they have found on Zillow. I want to help the buyer out, so I quickly search through the multiple listing service (MLS) to look at the property the buyer is talking about.
The only problem is the property does not show up in MLS listings.
The buyer found a pre-foreclosure home on Zillow – which for some reason, is a search option on the site – and of course, thinks that the house is for sale. These Zillow pre-market foreclosure listings cause confusion and angst for buyers and their agents.
The home isn’t actually for sale, and I am left trying to explain why this has happened. The situation comes up more than you can imagine.
When buyers search Zillow, they can include pre-foreclosure homes in their search. When buyers see the option for pre-foreclosures, they probably think it is just one more option for available homes.
RealtyTrac Sends The Data on Pre-Foreclosures to Zillow
Everyone has heard about all the foreclosures over the previous years, and everyone imagines a good deal from a foreclosure.
But the problem is, most of these homes are not for sale. Nor will they ever be for sale. The data Zillow collects on these homes comes from a company known as Realty Trac.
Realty Trac specializes in providing data centered around foreclosure homes. If you are looking for a pre-foreclosure list, Realty Trac is one of the real estate sites to visit.
Whenever a homeowner misses a payment on their mortgage and the lender sends a notice to the owner, Zillow takes this public record and lists the home in pre-foreclosure status on their site from the data provided to them by Realty Trac.
They go so far as to add an image from Google street view and some identifying details about the property.
The homeowner doesn’t even have the option to avoid this. Once the notice is sent, the home goes up on Zillow.
Of course, if the homeowner gets caught up on the mortgage, the home won’t go into foreclosure. Even if the house goes into foreclosure, it can take over a year to be available for sale.
Either way, the listings under pre-foreclosure found on Zillow are not helpful for the average home buyer. These Zillow pre-foreclosure listings are misleading and tend to create frustrating situations.
The buyer sees a great deal on Zillow and gets their hopes up, only to be dashed by the real estate agent that explains what is happening.
Zillow showing pre-foreclosure properties that are not for sale is deceiving the public!
Low Inventory Leading to Pre-Foreclosure Searches
Part of the problem is that there have been fewer houses available for sale. Further, the homes that are listed for sale go under contract within days of being on the market. Buyers have been looking for any edge they can get, given their often up against cash buyers or wealthy investors.
When homebuyers search Zillow and don’t find many options in their area, they may use Zillow to search for everything, including the pre-foreclosure listings.
Zillow does have a disclaimer that lets people know that pre-foreclosure homes may not be for sale, but this is a disclaimer that many site users overlook. A buyer finds a listing, and they contact their real estate agent, ready to buy the home they found.
This is just one issue when it comes to listing accuracy with Zillow. Given that Zillow collects their homes for sale information from third-party sites, the information provided is often old.
It can be frustrating for a buyer to go onto Zillow to look at homes posted for sale that have already been under agreement for weeks. In a hot real estate market, properties come and go like a fart in the wind. Stale data, unfortunately, is an all too common scenario with Zillow.
Real Estate agents are left with the job of explaining why it happens to their clients.
More Accurate Search Options
Ideally, Zillow should make it more challenging to search for pre-foreclosure properties so the average buyer does not get confused. But Zillow will do what it wants to do, and there is no guarantee that it will change things based on the frustrations of real estate agents and home buyers.
Stubbornness to change is undoubtedly evident from how much public dismay is expressed by real estate agents on the “Zestimate of value” previously mentioned. After years of general dissatisfaction, you would think that they would have eliminated the Zillow home value.
Instead, Zillow continuously makes excuses, stating that it is just a starting point. What exactly does that mean? When someone wants to know the value of their home, they expect accuracy, not a number tens of thousands off the mark!
Instead of using Zillow as a home search tool, buyers and sellers have better options, including finding a local real estate agent who can provide them direct access to the local multiple listing service (MLS).
For example, one of the popular search tools here in Massachusetts is MLS Property Finder. The website gives consumers direct access to properties for sale that comes right from the MLS.
Feel free to sign up and see every home available for sale in Massachusetts! One of the additional benefits of MLS Property Finder is getting notified the minute a home gets listed in a community and the price point you are looking in. In a competitive real estate market, this is a fantastic tool.
Realtor.com Has a Direct Feed to The MLS Listings
Another excellent option is using the National Association of Realtors site known as Realtor.com. This site has up-to-the-minute information on all homes for sale entered in the MLS. According to Realtor.com, the data on their website is updated every fifteen minutes.
Instant, accurate data is a far cry from what Zillow offers.
Zillow is a third-party aggregator, which means it pulls information from various sources to populate its site. Zillow can be helpful in certain circumstances, but it can also be misleading in others, particularly in the pre-foreclosure option.
Does Zillow Show All Homes For Sale? No, They Don’t!
Soon, there could be an even further disconnect between what is for sale and what is shown in Zillow. Several significant real estate organizations and even entire MLS boards have distanced themselves from Zillow.
These entities have decided to separate themselves from Zillow and not share their data anymore. Zillow will no longer show these homes listed on their site.
My suggestion would be to use some other search tools. Once you have located a few homes you are interested in, you can always look at these homes on Zillow to get any information you feel Zillow offers over and above other sites.
If you want more accurate search results for your area, you would be better off going through your Realtor’s MLS search. Your real estate agent wants you to find an ideal home for your needs and, more importantly, one that is actually for sale.
They can give you access to the same search tools that professional real estate agents use, especially if your Realtor has a website. All you have to do is go to your agent’s site and conduct a search.
Everything you find on the site should be for sale. Just like understanding the closing costs of buying a home, nobody wants to be misled down a path that gets them nowhere.
Avoid Being Fooled By Zillow Pre-Market Listings
If the housing supply is low enough to not find the home you want during your search, there are really only a few things you can do. First, you can let your real estate agent know what you are looking for and ask that they keep an eye out.
No one pays more attention to the changes in the housing market and new inventory than a Realtor. Second, you can perform your searches. Who knows, you may catch something that just came on the market.
Sometimes a buyer may beat you to the punch on a home you love. If this happens, you can always ask your real estate agent to put in a backup offer on the property for you.
Who knows, the sale may fall apart because of a home inspection or some other reason. The backup offer will allow you to jump to the head of the line, so to speak, for a home you had your heart set on!
Above all else, do not forget that many of the homes you see for sale on Zillow are not really for sale. Find another search tool with more accurate data so you don’t become frustrated during your quest to find a dream home.
Focusing on Zillow pre-foreclosure listings will only lead to disappointment and other buyers beating you to properties that should be on your radar.
How to Find Pre-Foreclosure Homes
Now that you’ve read about Zillow pre-foreclosure listings not being for sale, it may have piqued your interest in this type of property? If so, there are other ways of finding pre-foreclosure listings.
Finding off-market properties is more challenging, but you could find a diamond in the rough.
Foreclosure.com
One of the best places is Foreclosure.com. You can see pre-foreclosures along with other types of distressed properties, including sheriff sales, short sales, bankruptcies, city-owned, tax liens, and more. The site is not entirely free but has a free trial for those interested.
Search Public Records Yourself
To find a pre-foreclosure yourself, a popular first step is to head to the county recorder’s office. You will look for a notice of sale or notice of default. The document will typically include the contact information of the property owner.
If you have difficulty locating the property owner, see how to find out who owns a house for more guidance. Finding pre-market inventory this way obviously takes some work on your part.
When looking at this kind of potential foreclosure house, always make sure to perform a title search. You can have a real estate attorney or title company do this for you.
Other Pre-Foreclosure Listing Websites
Final Thoughts
Homebuyers need to understand that pre-foreclosure listings on Zillow are a long shot. A foreclosure sale is unlikely to take place. While finding pre-market inventory can be an exciting proposition, the odds are stacked against you.
When you want to be the first to find a new listing, you’re better off finding a connected local buyer’s agent. You’re much more likely to find a market property that suits your needs than thinking a list of pre-foreclosures on Zillow is going to turn into legitimate properties for sale.
Buyers also need to understand that these properties don’t always come with a bargain price.
Additional Helpful Home Buying Articles
- How to get the best mortgage rates – learn how you can get the best mortgage terms when buying a home. Use these tips to save thousands of dollars over the life of your mortgage.
- Home buying myths many think are true – When purchasing a home, there is always misinformation out there that can confuse the buying public. See some of the most common myths and avoid making mistakes.
- More reasons why Zillow Zestimates are inaccurate – see multiple articles explaining why Zillow estimates of value are not trusted. The values seen on Zillow are rarely accurate. When purchasing a home, there is always misinformation out there that can confuse the buying public. See some of the most common myths and avoid making mistakes.
Use these additional articles to help in the process of finding your dream home. Make sure you do not fall for the Zillow pre-market listings you see so often. Best of luck in your home search!
About the Author: The above Real Estate information on pre-foreclosure listings on Zillow are not for sale was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-625-0191. Bill has helped people move in and out of many Metrowest towns for the last 35+ Years.
Are you thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!
I service Real Estate Sales in the following Metrowest MA towns: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Natick, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton, and Uxbridge MA.
We can probably agree that bad things happen to good people. One of the bad things is that some good person, or whatever reason, has fallen behind or missed mortgage payments.
This causes Zillow to have this good person’s home to appear as a “Pre-Foreclosure”.
This person’s friends, family coworkers and maybe even their employer see this.
It could cause an embarrassing situation for this home owner.
I could go on and on with other scenarios about how and why “Pre Foreclosures” on Zillow are bad.
Not that it matters to Zillow.
The nice thing is that I am hearing more and more consumers that have realized just how full of crap Zillow is.
I could not agree with you more Mark. What value is there in posting these pre-foreclosures?
Great article as always.
What I want to know is why is it public record if you miss a mortgage payment!? This seems like private information – this is newsworthy in my opinion.
I agree with you Tammy. How does displaying this information benefit anyone but Zillow?
I’m not sure how it even benefits them? People just get frustrated and chose not to use them. Serious, this is crazy.
Bill, This does seem to be very bizarre behavior as people (companies) rarely do something without a financial incentive. If you then try to consider what is behind Zillow listing pre-foreclosures, it gets really interesting:
– Does Zillow want more listings than Realtor.com, and this is an easy way to accomplish this?
– Does Zillow get paid by RealtyTrac to post their listings, as someone is carrying the cost of grabbing photos from Google?
– Is the data from these pre-foreclosure listings influencing the automated zestimates in a way that Zillow finds favorable?
– … and if this data is part of their automated calculations, they may not want to invest in the programming to remove the data, a common problem?
My last guess is it’s possible that being naughty gets lots of Realtors writing about Zillow, driving up their page rank? If this were even a remote possibility, it would be good to misspell the name to throw the search engines off the trail.
Tina it is hard to understand why Zillow does some of the things it does. I suspect you are right about the free press thing. Good or bad Zillow is written about a lot. Everyone knows their Zestimate is a bunch of crap but yet they continue to mislead the public by having it on their site.