My understanding is that the process is started BEFORE the lender takes possession of the property. This is not a mortgagee sale. i am aware that the lenders here have a statutory obligation to get the best price they can when they take possession, but are they not free to forgive a debt, or discount it, if doing that solves the problem and…[Read more]

A pre-forclosure sale at under market price where a deal is made with the lender to accept less than what the distressed vendor owes on the property. Common in USA apparently. where lenders may accept anywhere from 50 – 80% of what they are owed simply to get the problem off their desk.