Buying a foreclosure can be a great way to secure a property at a discount. Whether you renovate it to sell for a profit or turn it into a rental, the low upfront cost can boost your returns.
The time it takes to buy a foreclosure varies by state and property. However, you can generally expect the process to take 30-60 days.
At ABL, we’ve helped investors nationwide seize foreclosure opportunities with flexible loan programs that let you move fast, preserve your capital, and maximize returns through leverage.
What Is a Foreclosure?
A foreclosure is a property that a lender has repossessed from a previous owner due to their failure to make mortgage payments, and that the lender is now selling to recoup their losses.
Since lenders and banks aren’t interested in being landlords, they typically price foreclosure properties to sell quickly, often below market value to avoid extended holding costs. As a result, investors can often buy foreclosures at great prices, increasing their returns.
What’s more, foreclosures are on the rise. In October 2025, they were up 3% from the previous month and 19% from the same time last year.
The Foreclosure Process
That said, to seize foreclosure opportunities, you must understand how the foreclosure process works. This can vary by state, but here’s what generally happens:
1. Payment Default
First, a homeowner will miss a mortgage payment. They can often avoid late fees by paying the debt within a grace period. If not, they’ll start to incur penalties.
2. Notice of Default
Once a mortgage payment is 90-120 days past due, the lender will file an official “notice of default” (NOD) with the county recorder or court, formally beginning the foreclosure process.
3. Foreclosure Filing
After the notice of default is filed, the lender can initiate the official foreclosure process. In judicial foreclosure states, this involves filing a lawsuit. In non-judicial foreclosure states, foreclosure can proceed without involving the court.
4. Foreclosure Sale
Eventually, the homeowner will be notified of a foreclosure sale, in which the lender will try to sell the property to the highest bidder at an auction.
Meanwhile, the homeowner will be required to move out or face eviction.
Keep in mind that some states offer a “redemption period”—either before or after the foreclosure sale—during which homeowners can reclaim their property by paying the full amount owed plus fees. However, this varies significantly by state.
Where Can I Find Foreclosures For Sale?
Now that you know how foreclosures work, let’s explore how to find them.
Despite foreclosures being on the rise, they still account for only a fraction of U.S. homes. In October 2025, one in every 3,781 U.S. homes was in foreclosure.
As a result, foreclosure deals can be hard to find—unless you know where to look.
Here are the best places and ways to find foreclosures for sale:
- Foreclosure databases: Specialized sites like Foreclosure.com and Auction.com aggregate foreclosure properties nationwide with property data and auction dates.
- Traditional home listing sites: Major platforms like Zillow, Realtor.com, and Redfin include foreclosure filters that let you search foreclosure properties listed on the MLS alongside traditional homes.
- Government and bank sources: Government agencies like the Department of Housing and Urban Development (HUD) and Freddie Mac sell their foreclosed properties directly on their websites, while banks often list their foreclosure inventory on theirs.
- Local sources: Your county courthouse, tax assessor’s office, and local newspaper publish required foreclosure sales announcements, giving you access to upcoming foreclosure auctions before they hit online databases.
- Networking: Building relationships with foreclosure-focused real estate agents, attending local real estate investment meetups, or connecting with wholesalers can give you access to foreclosure deals early, before they become widely available.
6 Tips for Buying Foreclosures
Here are our top tips for buying a foreclosure:
Get Pre-Approved Before You Start Shopping
Foreclosures move quickly. If you’re not ready to buy, you’ll lose the deal to other buyers. So get pre-approved for financing upfront. For example, we can pre-qualify you for a loan within 24 hours and close in as few as 10 days.
Always Conduct Thorough Due Diligence
Foreclosures are almost always sold as-is and often don’t allow inspections. As a result, you must be extra thorough in your due diligence. Research the property’s condition as much as you can as well as its title and any potential liens.
Budget for Repairs and Unknowns
Homeowners who couldn’t afford their mortgage payments likely didn’t keep up with maintaining the property either. In some cases, embittered homeowners may have even purposefully damaged the property before being evicted. So always set aside part of your budget for repairs.
Know Your Maximum Offer Before Bidding
To avoid overbidding at auction, determine your maximum offer upfront. Don’t forget to factor in repairs and holding costs after the purchase. The sum of all of the above plus the minimum profit margin you’re willing to accept should be your maximum bid.
Have an Exit Strategy
Don’t go into a foreclosure purchase blind. Know whether you’re flipping, renting, or wholesaling the property before you buy, as this affects which foreclosures make sense for your business. The last thing you want is to get stuck with an unwanted property.
Build a Reliable Team
Partner with a professional agent, real estate attorney, title company, and lender like ABL. They should each be familiar with the foreclosure process in your area to help streamline the investment process. The same goes for contractors who will help with post-sale renovations.
Fund Your Next Foreclosure Property an ABL Loan
Foreclosure properties offer incredible opportunities for savvy investors, but timing is everything. Whether you’re bidding at a live auction or on a foreclosure website, having fast, flexible financing can be the difference between landing a deal and watching it slip away.
ABL’s hard money loans are designed specifically for investors like you—offering quick closings, competitive rates, and the flexibility to fund purchases and renovations in one fix-and flip loan. Don’t let a great foreclosure opportunity pass you by because your financing isn’t ready.
Pre-qualify for an ABL loan today!