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The value of this variable is a list of functions to be called when ‘find-file’ or ‘find-file-noselect’ is passed a nonexistent file name. ‘find-file-noselect’ calls these functions as soon as it detects a nonexistent file. It calls them in the order of the list, until one of them returns non-‘nil’.
This is not a normal hook because the values of the functions are used, and in many cases only some of the functions are called.