Foreclosure words in plain English
Every page on this site uses the simple name first and the official word in parentheses. Here is what each one means and why it matters when you are thinking about bidding.
- Amount owed(Final judgment)
- The total the court says the borrower owes: the loan, interest, late fees and legal costs. Bidding at the auction usually starts near this number.
- Starting bid(Opening bid)
- The lowest bid the auction will accept. It is often a small number, so the real price is set by the bidders.
- Lender's top bid(Plaintiff's maximum bid)
- The most the lender (or association) says it will bid to protect what it is owed. If nobody bids more, the lender takes the house back.
- Who is foreclosing(Plaintiff)
- The company or group that filed the lawsuit. Usually the bank that holds the mortgage, sometimes a homeowners' association that is owed dues.
- Owner being foreclosed on(Defendant)
- The person who owns the house and owes the money. Other defendants can be a spouse, tenants, or other lenders.
- Lawsuit notice(Lis pendens)
- A public notice recorded against the house that says a lawsuit is pending. It is the first step of a foreclosure.
- Court timeline(Docket)
- The list of everything filed in the court case, in date order: the complaint, motions, the judgment, the sale notice.
- Recorded documents(Recorded instruments)
- Official papers filed with the county about the house: deeds, mortgages, liens and releases. They show who is owed what.
- Sale certificate(Certificate of sale)
- The paper the Clerk issues after the auction naming the winning bidder. Objections can be filed for 10 days after it.
- Title certificate(Certificate of title)
- The paper that makes the winning bidder the legal owner. It comes about 10 days after the sale if nobody objects.
- Debt attached to the house(Lien)
- A claim on the house for money owed: a mortgage, unpaid taxes, HOA dues, or a court judgment. The house cannot be sold free and clear until it is paid or wiped out.
- Who gets paid first(Lien position)
- Debts are paid in the order they were recorded. A first mortgage is senior; later debts are junior and get wiped out when the senior lender forecloses.
- Association lien(HOA or condo lien)
- A neighborhood or condo association can foreclose for unpaid dues. When it does, the bank's mortgage usually stays on the house and the buyer still owes it.
- Debt that stays with the house(Surviving debt)
- Debts the buyer still has to pay after the auction. A bank foreclosure wipes out smaller debts behind it, but an HOA foreclosure leaves the bank's mortgage in place.
- Everything that stays(Total risk)
- Debt that stays with the house plus unpaid property taxes. This is what the buyer takes on besides the bid.
- Room for profit(Equity cushion)
- What the house is worth minus everything that stays with it. Bigger is better; a negative number means the house owes more than it is worth.
- Most you should bid(Suggested maximum bid)
- Our ceiling: the value, minus debt that stays, taxes, repairs, closing costs and a 20% safety margin. Bidding above it leaves no room for mistakes.
- Worth about(Estimated value)
- What the house is probably worth today. We start from the Property Appraiser's market value and use comparable sales when a bot has found them.
- Market value (appraiser)(Just value)
- The Property Appraiser's estimate of what the house would sell for. It is the county's number, updated once a year.
- Assessed value
- The value the county uses to figure property taxes. Homestead and other caps can keep it below the market value.
- Homestead(Homestead exemption)
- A tax break for owners who live in the house. If it is on, the owner probably lives there, which matters for possession after the sale.
- Tax certificate
- When property taxes go unpaid, the county sells the debt to an investor as a certificate. It earns interest and must be paid off by whoever owns the house.
- Tax deed(Tax deed application)
- After two years, a certificate holder can ask the county to sell the house for the taxes. That sale can happen no matter what the foreclosure case does.
- Parcel number(Folio)
- The county's ID number for the lot. Use it to look the property up with the Property Appraiser or Tax Collector.
- Fix-up cost(Repairs estimate)
- A guess at what it will take to make the house rentable or sellable. It comes from an inspection note when there is one, otherwise a standard allowance.
- Closing costs
- What it costs to take ownership after winning: the Clerk's fees and the deed stamp tax on the bid.
- Safety margin(Margin)
- The cushion we subtract so a surprise does not turn the deal into a loss. We use 20% of the value.
- Rent return(Gross yield)
- A year of rent divided by everything you would have in the house. Higher means the rent pays you back faster.
- Risk(Risk rating)
- Low means the numbers look clean. Medium means something needs checking. High means a big debt stays with the house, a bankruptcy or federal claim is in play, or the facts are missing.
- CDD fees
- Community Development District fees: a yearly charge, billed with the property taxes, that pays off the bonds for a neighborhood's roads, ponds and parks. They stay with the house no matter who owns it.
- All in(All-in cost)
- Everything it takes to own the house free and clear: the bid, closing costs, debt that stays, taxes owed, fix-up and holding costs.
- Debt to income
- Yearly debt payments plus running costs, divided by yearly rent. Under 80% means the rent comfortably covers the house; over 100% means you feed it money every month.
- Debt coverage(Debt service coverage ratio)
- What is left after expenses, divided by the mortgage payments. Lenders like 1.25 or higher; below 1.0 the rent does not cover the loan.
- Cash-on-cash return
- Yearly cash flow divided by the money you put in. It is the rental version of an interest rate on your investment.
- Government buy-back right(Federal redemption right)
- If the IRS or another federal agency is named in the case, the government can buy the house back from the winner for up to 120 days after the sale.
- Bankruptcy(Bankruptcy stay)
- When the owner files bankruptcy, the court pauses the foreclosure. The sale cannot happen until a judge lifts the pause.
- May be canceled(Pending cancellation)
- Someone has asked the court to call off the sale, usually because the owner paid up or is working out a deal. Check again before the sale day.
- How the case ended(Disposition)
- The court's final outcome for the case, such as a judgment, a dismissal, or a settlement.
Want to see how these fit together? Open any sale from the map and read the "What matters on this one" section, or see how the data is gathered.