Executive Summary: Foreclosure history real estate lending diligence starts with a simple fact: judicial foreclosure requires court authorization, which makes the action part of the public court record.[1] For a bridge or real-estate lender underwriting a borrowing entity, a prior foreclosure or related litigation is a repayment-behavior signal worth surfacing before funds move, because a money judgment can attach as a lien to the debtor's property.[2] This guide turns that signal into a workflow: what to check, where Cobalt's court data fits, and where it must hand off to county records.
Why does foreclosure history matter to a real estate lender?
What does a prior foreclosure reveal?
A foreclosure on a borrowing entity's record shows that a prior secured obligation went to default and through legal enforcement. That pattern speaks to how the borrower handled leverage under stress, which is exactly what a bridge lender needs to know before extending short-term, collateral-backed credit.
Why is self-reported history not enough?
A borrower may omit a foreclosure that was settled, dismissed, or filed under a related entity name. A public court search gives the lender an independent control that does not depend on the applicant's disclosure, the same logic that drives pre-funding lien checks.
What court signals connect to foreclosure risk?
Which records belong in the file?
Real-estate default rarely travels alone. Look for the foreclosure action itself, related money judgments, and any business litigation tied to the entity. Each adds context about whether a single bad deal or a recurring pattern sits behind the file.
| Signal | Underwriter action | Why it matters |
|---|---|---|
| Prior foreclosure judgment | Manual review | Default went through legal enforcement, not just a late payment |
| Open money judgment | Funding hold | A filed judgment can attach as a lien to entity property |
| Multiple related suits | Manual review | A pattern of distress, not a single isolated event |
| No court record in covered venue | Continue with documentation | Absence in two venues is not nationwide clearance |
| Borrower entity outside coverage | Fallback to county records | Coverage gap must be closed, not assumed clean |
How should the legal name be normalized?
Start with Secretary of State entity verification so the court search runs against the correct legal name and state. Court systems are name-sensitive, and a search against the wrong entity name can miss a real record or surface a stranger's.
How does Cobalt return court data for this check?
What jurisdictions does the API actually cover?
Cobalt's Court Case API covers New York State and Miami-Dade County, Florida only. It is not a nationwide foreclosure search and does not pull consumer-level foreclosure records or PACER. For a borrowing entity that operates in those two venues, the API returns a fast programmatic state-court signal. Everywhere else, the workflow routes to county records.
What does the API call look like?
The endpoint is `GET /courtCases`, it searches by business name, and it is callback-only. Cobalt POSTs the results to your callback URL, typically within 30 to 120 seconds.
curl --location 'https://apigateway.cobaltintelligence.com/courtCases?businessName=Harbor%20Point%20Holdings%20LLC&jurisdiction=miamiDade&callbackUrl=https://your-app.example.com/cobalt/callback' \
--header 'x-api-key: YOUR_API_KEY' \
--header 'Accept: application/json'What data comes back and what does it not include?
Which fields does the API return?
The documented fields are judgment details such as type and status, case information including case number and court division, filing dates, the parties involved, and judgment amounts where available. Amounts are not always present, so a missing amount is a prompt to confirm, not a zero.
What are the honest limits?
The API does not cover states beyond New York and Miami-Dade, does not search consumer or property-level foreclosure records, and does not stream docket events or alerts. Court-record completeness also depends on what each court makes electronically accessible, so older cases or certain case types may be missing.
How should the workflow handle coverage gaps?
Why must fallback be explicit?
The right workflow says one of three things: a clean covered search, a risky covered search, or an unsupported venue requiring a county-records fallback. The wrong workflow treats an unsupported state as clean. Because foreclosure is recorded at the court and county level, a borrower outside the two covered venues needs a county clerk or court-portal search to close the gap.
Who runs the fallback?
Assign the county-records pull to a named step with an owner, a source, and a logged outcome. Florida court records are available through county clerks of court, and a fallback in a non-covered state should follow the same pattern of documented source and result.[3]
The practical question is not whether the borrower says the prior project closed cleanly. It is whether the public court record supports that statement before the bridge funds.
What compliance limits apply to using this data?
How does the FCRA shape use of court records?
Court judgments and suits are public records, and using them in credit decisions can trigger Fair Credit Reporting Act duties, which Regulation V implements for furnishers and users of report data.[5] The FCRA bars consumer reporting agencies from reporting most civil suits and judgments that antedate a report by more than seven years.[4] Cobalt is a data source, not a consumer reporting agency and not a decisioning engine, so the lender owns how the signal is used and any obligations that attach.
Where does the lender's judgment stay?
Cobalt provides the court data; the lender builds the rules and owns the decision to fund, condition, or decline. The API surfaces a signal, not a verdict on the deal.
How does this fit a complete real estate risk stack?
What should run alongside the foreclosure check?
Pair court records with entity verification and lien discovery. See the pre-funding UCC lien search underwriter workflow for the lien layer[6] and BSA/AML for alternative lenders and OFAC's role for the sanctions and compliance layer.[7]
What belongs in the audit trail?
Store the raw API response, the parsed fields, the jurisdiction searched, the fallback result for uncovered venues, and the decision reason. A foreclosure discovered after funding is only a postmortem.
How can a real estate lender get started?
A team can start by mapping which borrowing entities sit in New York or Miami-Dade and where the county-records fallback will run for every other venue. To see the Court Case API return litigation data on a sample entity, book a Cobalt demo and review the workflow with the team.
.jpg){kind=small}
.png)