nonforeclosed

Nonforeclosed is an adjective used to describe a loan, mortgage, or property that has not undergone the foreclosure process. In real estate and financing contexts, a loan may be in default or delinquent, but if foreclosure proceedings have not been initiated or completed, the loan is considered nonforeclosed. The status can occur during pre-foreclosure negotiations, such as discussions about loan modification, forbearance, or other alternatives to foreclosure.

In practice, nonforeclosed loans keep ownership with the borrower and retain the lender’s lien on the property. Foreclosure typically begins after a period of missed payments and notices, but many lenders pursue alternative resolutions before or instead of foreclosure. If a loan remains nonforeclosed, the borrower may still cure the default, sell the property through other channels, or reach an agreement that avoids foreclosure.

The term can also appear in real estate listings or market analyses to distinguish properties that have not been repossessed by lenders from those that have become bank-owned or REO (real estate owned) after foreclosure. Buyers and investors may view nonforeclosed properties as opportunities to negotiate settlements or favorable terms, but they also face ongoing risk if the borrower is unable to cure the default.

See also: foreclosure, delinquency, forbearance, loan modification, short sale, REO.