Lis pendens vs notice of default: which one is your lead?
By Josh MillerUpdated 4 min readThey're the same lead under different names: in judicial-foreclosure states like Florida, New York and Illinois, the first public record is a lis pendens filed with the lender's lawsuit; in nonjudicial states like California, the lender records a notice of default instead, and in Texas the first public record is usually the notice of sale. Which one your state uses decides how much time the owner has, so it decides how long you mail.
"Pre-foreclosure" isn't a legal term. It's what investors call an owner after the lender has started foreclosing and before the house is sold. What the county actually records depends on your state, and that record tells you how long you have.
Two kinds of foreclosure
Judicial foreclosure: the lender sues the owner in court. With the complaint, the lender records a lis pendens, a notice that a lawsuit affecting the property is pending. A judge has to enter a judgment before a sale. Florida, New York, New Jersey, Illinois, Ohio and Pennsylvania foreclose this way.
Nonjudicial foreclosure: the deed of trust gives a trustee the power to sell without a lawsuit. The state's statute sets the notices. California records a notice of default, then a notice of trustee's sale at least 3 months later, at least 20 days before the sale. Texas skips the notice of default as a public record: the first one most investors see is the notice of sale, filed with the county clerk at least 21 days before the first-Tuesday auction. Arizona, Georgia, Tennessee and Michigan also foreclose mostly outside the courts, each with its own notices.
| Judicial states | Nonjudicial states | |
|---|---|---|
| First public record | Lis pendens, with the lawsuit | Notice of default or notice of sale |
| Who runs the sale | The court, often a sheriff or referee | A trustee |
| Typical length | Months to over a year | Weeks to a few months |
| Examples | FL, NY, NJ, IL, OH, PA | CA, TX, AZ, GA, TN, MI |
What it means for your mail
The length of your state's process is the length of your campaign. In the county records, owners in the long judicial states sold slowly: in Illinois's measured counties, about 1 of every 100 owners with a foreclosure filed sold off-market in the first 3 months and about 11 by month 12. In California's, about 4 in the first 3 months and about 15 by month 12. The full state-by-state count.
- Judicial state: mail across the year. The owner has time and often uses it.
- Nonjudicial state: start the week the notice posts and mail tight. In Texas, three weeks can be the whole window before the auction, though sales are often postponed and the owner gets another notice.
Read the record before you mail
- A lis pendens isn't always a foreclosure. Check the case type.
- A notice of default can be cured. Take out owners who reinstated before every letter.
- A notice of sale can be cancelled or postponed. A new notice often means a second chance, not a lost lead.
Questions investors ask
What is a lis pendens?
A notice, recorded in the county property records, that a lawsuit affecting the property is pending. In a judicial foreclosure the lender files one with its complaint, which makes it the first public sign the owner is in foreclosure.
What is a notice of default?
In nonjudicial states that use them, like California, the trustee records a notice that the borrower is in default and has a set time to cure before a sale can be scheduled. In California the notice of sale can't come until at least 3 months after the notice of default.
Is a lis pendens always a foreclosure?
No. A lis pendens can be filed for any lawsuit over a property, like a boundary dispute or a contested sale. Check the case type before you mail.
Which is a better lead, a lis pendens or a notice of default?
Neither is better in itself. A lis pendens usually gives you more time, because judicial foreclosures take longer; a notice of default gives you a shorter, clearer clock.