When purchasing a residence, you hope that the property will not only be a place you'll be glad to call home, but also an asset. After years of building up equity through regular mortgage payments, and perhaps through rising home values, the property can yield a significant amount of money when you decide to sell it.

Unfortunately, this situation doesn't always happen. Values in the neighborhood may have sunk your home's value below what the homeowner paid for it; if they need to move for a job transfer or other reasons, they may find yourself owing more on the mortgage than the home is worth. Other homeowners find themselves unable to make regular mortgage payments due to unemployment, divorce, or other financial stresses.

It can be a very trying time for a homeowner when a lender begins foreclosure proceedings against them. But there are still some avenues available to sell the home before the property is auctioned off. These options may not carry much financial benefit for the homeowner, but they can help preserve their credit score.

Any homeowner who is worried about their ability to keep up with their mortgage payments should first inform the lender about this trouble. Lisa Kaplan Gordon, writing for the National Association of Realtors, says the lender may be willing to grant forbearance or restructure the loan.

Foreclosure proceedings typically start when the homeowner has missed a certain number of payments and the lender issues a notice of default. It will usually take several months for the pre-foreclosure process to be resolved, and the homeowner still legally owns the property during this time.

The homeowner will need to inform the lender that you would like to try to sell the home before it is foreclosed. The real estate data site RealtyTrac says the lender may be willing to postpone the foreclosure proceedings, but will still likely set a deadline for finding a buyer. It may be better to look for an investor instead of marketing the home against competing properties if the deadline is particularly close.

Homeowners typically have to meet some conditions to qualify for a pre-foreclosure sale. Angela Colley, also writing for the National Association of Realtors, says those with government-backed loans require the property to be owner-occupied rather than an investment property. They also require the homeowner to use a real estate broker instead of trying to sell the home on their own.

Getting a real estate professional is a wise move even if the mortgage is not a government-backed loan. Gordon says a real estate agent will be able to conduct a market analysis to determine how much the home will be worth in a sale, and will also be able to negotiate with the lender.

Ideally, the sale price should be able to satisfy whatever amount is owed to the lender, including penalties and fees. The homeowner may even be able to realize a profit on a pre-foreclosure sale.

Lenders aren't usually keen to pursue a foreclosure unless absolutely necessary. They may agree to a short sale, in which the property sells for less than what is owed on its mortgage and the lender accepts this amount to resolve the loan.

One of the biggest benefits of a pre-foreclosure sale is that it helps the seller preserve their credit score, which would otherwise be dealt a major blow by a foreclosure. Colley says it can also help them avoid a deficiency judgment, which a lender might pursue if the sale of the foreclosed property nets less than what the homeowner owed on their mortgage.